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. Last Updated: 07/27/2016

UES to Pay $972M for Bulgarian Plants

SOFIA, Bulgaria -- Bulgaria's privatization agency chose Unified Energy Systems on Monday to buy the country's Varna and Ruse thermal power plants for 757 million euros ($971.6 million) in cash and investment.

But the agency said it had not yet made a decision on a bid for a third power plant in the town of Bobov Dol, for which Greece's Public Power Corp., PPC, has offered 105.3 million euros.

"The two deals [Varna and Ruse] should be approved by the supervisory board of the privatization agency," the agency said in a statement.

It said that after the agency approved the sales, contracts could be signed within 30 days.

UES has offered 578.8 million euros in cash and a required capital hike through 2007 for the 1,260-megawatt coal-fired plant at the Black Sea city of Varna, and 178.2 million for the 400-megawatt plant in Ruse, in northern Bulgaria.

The Russian company's offers far exceeded those filed by rival firms, which include Czech CEZ, Italy's Enel, and PPC and beat analyst forecasts that the three sales combined would bring a total of 250 million euros.

Bulgaria hopes to offload the power assets -- and attract investment to the sector -- before joining the European Union in 2007 so it can keep its position as southeast Europe's leading power exporter.

But the sale of Bobov Dol has hit a political roadblock ahead of June 25 general elections. Workers at adjacent mines have called for its halt, fearing massive layoffs if the new owners stop buying local coal.

The privatization agency said it could decide on the 630-megawatt thermal plant in the coming days, but a government source said it may call off that sale.