Hockey and gas magnate warns on government buy-in

Take note – story published 9 years and 9 months ago

As the government mulls options to acquire the 47.23% share of joint-stock company gas utility Latvijas gāze (LG) from German energy firm E.ON Ruhrgas, another LG shareholder and its deputy board chairman, Juris Savickis of gas importer Itera Latvija believes Russia will raise its prices if the state decides to buy the stock for holding.

Savickis told LTV morning news program Rīta Panorāma that the government should only consider buying the shares on offer by the German concern, which wishes to exit the Baltic market, if it knows there is a guaranteed buyer for them further down the road.

Lacking any guarantee of such interests, “under no circumstances” should Latvia become an LG stockholder, as the government’s representatives in the company will lead it to “political gas prices”, to which the government itself will respond and “immediately cause the price to rise further,” moreover the firm’s “effectiveness” would vanish, Savickis argued.

Savickis - who is also chairman of the local Dinamo Riga ice hockey team - outlined details of his ongoing negotiations with several Russian energy firms regarding financial support needed by the team to finish its season.

He discounted the notion that the team could remain without long-term sponsors, despite the disappointment of losing accounts with prime corporate supporters Gazprom Schweiz and Škoda earlier this year and acknowledging estimates that €12m would be needed to maintain the club through its next season.

Dinamo’s 35 players are currently training in Valmiera despite most of them facing contract signing delays. Foreign players can opt out if they receive more attractive offers from other clubs, and the team’s recruitment policy favors local hockey players.

Savickis didn’t rule out the possibility that Dinamo could drop out of the KHL league, which he termed a “dynamic creation” whose members can come and go. He said €7m had been spent by Dinamo over the past six years, but that future prospects call for more serious investments. Anything less than next year’s desired €12m budget would mean a much more modest team performance.

Savickis added that “it would be easy” for the state to sponsor the hockey club, if only the political will existed. He said he is convinced that Dinamo gives more added value to society than Latvia’s Foreign Affairs Ministry.

LG is currently jointly owned by its largest shareholder E.ON, followed by Russian gas giant Gazprom (34%) and Savickis’ import firm Itera (16%).

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