Bulgaria’s Watchdog Suspends Eurohold’s Buyout Offers

Bulgaria’s competition authority said it has temporarily halted two separate tender offers by energy and insurance group Eurohold Bulgaria to increase to 100% its ownership of power grid operator CEZ Distribution Bulgaria and power supplier CEZ Electro Bulgaria.

The offers to minority shareholders were found to contain inconsistencies and inadequate information, including details on the financing of the proposed acquisitions, the Commission for Protection of Competition (CPC) said in a statement on Tuesday.

Eurohold Bulgaria’s wholly-owned subsidiary Eastern European Electric Company (EEEC) has been banned from publishing an offer for the acquisition of 20,581 shares representing 1.07% of the share capital of CEZ Distribution Bulgaria, recently rebranded to Electrodistribution Grid West, the CPC said.

The antitrust body also said that it banned the publication of an offer by the Netherlands-based EEEC for the acquisition of 154 shares representing 3.08% of the share capital of CEZ Electro Bulgaria, rebranded to Electrohold Sales.

Considering market conditions, the CPC also found that revenue estimates in the tender offers are unreasonably low, with no market and regulatory justifications and even contrary to current market trends for electricity price increases. The CPC pointed to the 45% annual increase in CEZ Electro’s revenue in 2021.

The regulator suggested that there will be a need to recalculate the fair price per share that EEEC has offered to the minority shareholders of the two companies.

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