The main power utility PPC’s effort to secure a needed 200 million-euro loan from the country’s four main banks, demanding heightened guarantees as a result of the utility’s ongoing bailout-required detachment and sale of its subsidiary firm IPTO, the power grid operator, now faces yet another obstacle, raised by medium-voltage industrial clients.
Certain medium-voltage industrial enterprises have expressed extreme concerns over a PPC plan to transfer electricity supply contracts to the banks as a form of guarantee for the utility’s prospective loan.
The issue concerning PPC client contract transfer rights is not new. It emerged as an obstacle during negotiations between the utility and medium-voltage industrial firms for new electricity supply deals. The utility has insisted on including a clause permitting electricity supply agreement transfers, without the client’s consent, as it intends to shift customers to new subsidiaries that will be then be offered for sale, possibly with PPC as a shareholder, as a means of reducing its market share, a bailout requirement.
Certain industrial clients have refused to sign new electricity supply agreements with PPC as a result of the utility’s insistence on such a clause.
Industrial client reactions to the transfer clause have now further intensified as PPC is locked in tough negotiations with the country’s main banks for the new loan, needed by the utility for a cash flow improvement.