Hidroelectrica negotiating several loans worth EUR 300 million

• Final negotiations are ongoing with BCR, BRD, ING, Raiffeisen, Unicredit and CitiBank

Hidroelectrica has been negotiating for some time the taking out of several loans for investments with a total value of 300 million Euros. Sources close to the negotiations say that the new management of Hidroelectrica has been holding talks with all the Romanian banks and that the final negotiations are under way with BCR, BRD, ING, Raiffeisen, Unicredit and CitiBank. The same sources say that these negotiations will be concluded by the end of November, and the loans will not be guaranteed by the State.

The general manager of Hidroelectrica, Mihai David, yesterday said, on the occasion of the activation of the hydroelectric plant in Ipoteşti, which was upgraded using an investment of around EUR 65 million: "We have already signed the contracts for two loans amounting to around 50 million Euros. I can"t tell you the names of the banks, because we are still negotiating with four more banks, for the remainder of the money, up to 300 million Euros".

The funds will be used for the upgrade and modernization of the hydroelectric power plants, as the company used these loans to restructure their short term loans.

Hidroelectrica officials had a problem in negotiating their loans, as banks are wary of funding energy investments without solid collaterals. Sources that wanted to remain anonymous said that the alternative of negotiating smaller loans with Romanian banks was the only one that was feasible in order to secure the necessary funding.

In 2007, Hidroelectrica announced that it intended to negotiate the taking out of loans worth around EUR 900 million. The first negotiations began at the time, with Deutsche Bank, Erste Bank, CitiBank and ING. The company currently has ongoing loans worth EUR 400 million.