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. Last Updated: 07/27/2016

Grid Firm May Get Stuck With UES Debt

The Federal Grid Company could be saddled with debt from former power monopoly Unified Energy System after the two are merged next year, UES chief executive Anatoly Chubais told Kommersant on Thursday.

"From the point of view of corporate procedure and from a legal perspective, the transfer of debts and assets onto the balance of the [Federal Grid Company] is possible," Chubais said in an interview with the newspaper.

UES is in the process of selling off all of its assets by July 1, 2008. The legal entity of UES left after all its assets are spun off will be fused with the Federal Grid Company. This shell will include all of UES's liabilities and remaining assets.

In September, UES announced that it was taking out a loan of $1 billion in order to fund a buyout of UES shareholders who voted against the final stage of the reforms.

Chubais said UES would buy out no more than 10 percent of its voting shares and that it would spend no more than 102 billion rubles ($4.13 billion) on the buyouts.

After the break-up of UES, the government will maintain a 76 percent stake in the grid company, which controls the main network of high-voltage power lines. The remaining shares will be available to private investors in part as Global Depository Receipts, which the Federal Grid Company will make available next year.