HIDROELECTRICA TURNS ITS BACK ON THE BUCHAREST STOCK EXCHANGE: Goodbye and I won't stay with you!

Taken completely by surprise, yesterday, our entire energy market was turned upside down by the news that "Hidroelectrica" has filed for insolvency last weekend in the Court of Bucharest. The Minister of the Economy had the following to say yesterday on this information: "The decision to file for insolvency was made by the Board of Directors of Hidroelectrica SA, and the Ministry of the Economy, as shareholder, does not interfere in any way in the legal proceedings in which the state owned companies are involved, to avoid influencing the courts in any way".

However, the surprise comes from the fact that some of the members of the Board of Directors of Hidroelectrica expressed their shock at this decision.

Andrei Todea, one of the five members of the Board of Directors (CA) of Hidroelectrica, yesterday said that he doesn't know why the decision to file for insolvency was made, because he did not participate in the board meeting where this decision was made.

Todea had the following to say to Mediafax: "I don't know anything, I didn't participate in that meeting of the Board and I did not see the study which led to this decision. I can't make a statement on this".

Apparently the chairman of the Board of Directors of Hidroelectrica, Remus Vulpescu, did not know anything about the decision to file for insolvency, according to his statement published in the media.

Hidroelectrica is one of the companies which is set to get listed on the Bucharest Stock Exchange this year. However, lawyer Cristian Duţescu considers that the listing of the shares of Hidroelectrica ca no longer be accomplished.

Stock market players expressed their shock at the decision to file for insolvency, saying that this could cause Romania to lose credibility before investors.

The management of the Bucharest Stock Exchange yesterday was left "speechless" upon hearing the news of Hidroelectrica filing for insolvency. "I for one won't comment. We are waiting for more details", said Lucian Anghel, the president of the BSE.

• The biggest concern - the selling of Hidroelectrica piece by piece

The worry gripping the market is that the reorganization of the company, the crown jewel of the energy system, is not actually intended to cancel the contracts signed by the company with the so-called "clever boys", but rather the sale of Hidroelectrica piece by piece.

According to the insolvency practitioners, a successful reorganization can be made by terminating the contracts which are harmful to the company, or by selling off assets at the best market price.

It is obvious that under the current market circumstances, if the insolvency of the company will be accepted by the Court of Bucharest, the sale of the assets of Hidroelectrica will not end up making too much money for the company.

According to sources in the energy market, less than a month ago, almost immediately after the appointment of the Ponta government, the Board of Directors of Hidroelectrica decided to cancel a bond issue of 200-300 million Euros.

According to these sources, the new government had planned to declare the company insolvent a long time ago and deliberately deprived the company of cash.

According to the insolvency law, if the manager or the owner of a company is proven to have deliberately caused the company to become insolvent, then they are criminally liable for their actions.