Part sale of ESB and Bord Gais to raise €3bn in funding
THE GOVERNMENT is planning to sell off parts of the ESB and Bord Gais in a bid to raise €3bn - €1bn of which will be put towards job creation.
However, the strategically important networks of both companies, which carry gas and electricity, will be remain in State control.
In the case of Bord Gais, the company’s energy business, excluding its gas transmission and distribution systems and two gas interconnectors, are for sale.
Some of ESB’s non-strategic power generation capacity has also been put on the block but the Government has held back on selling a minority stake in the firm.
Barclays Capital has been hired by the National Treasury Management Agency to advise on options for Bord Gais.
The plans were announced by Minister for Reform Brendan Howlin following approval by cabinet.
Use of some of the funds for job creation was approved by the ECB/IMF/EU after the latest memorandum of understanding.
"When we came into Government, the position was that no money from the disposal of assets could be spent on anything except reducing our debts," Mr Howlin said.
"I am pleased that following intense engagement, the Troika (the European Commission, the European Central Bank and the International Monetary Fund) has agreed that one-third of the proceeds can be used for reinvestment into our economy.
"This is a substantial change to the Troika's previous position and will help promote recovery in the economy."
Other sales include some forests owned by Coillte but not the land on which they are planted.
In addition, the remaining state-controlled stake in Aer Lingus will be sold when conditions are favourable and the stock market price is acceptable to the Government.