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Friday, May 24, 2024

Golob’s covert wheeling and dealing: Gen-I is taking on additional debt, inviting only selected few to purchase bonds – could the goal be the later privatisation of the company?

By: Vida Kocjan

The company Gen-I has sent an invitation to selected investors to subscribe (purchase) green bonds, which it intends to issue in a total amount of up to 50 million euros in the second quarter of this year. These are five-year bonds with a face value of 100,000 euros and a fixed interest rate of 5.20%, aimed at supporting green transformation projects.

Gen-I has decided to offer green bonds exclusively to invited investors who, in accordance with the Financial Instruments Market Act, have the status of a professional client or eligible counterparty. The subscription offer was sent to them based on the results of market sounding conducted in recent weeks, Gen-I announced today through the Ljubljana Stock Exchange’s website.

This will be the second issuance of green bonds by one of the companies in the Gen-I group. In 2017, Gen-I Sonce issued the first Slovenian green bond, raising 14 million euros for the purpose of financing green energy and energy efficiency projects.

According to Gen-I, the purpose of the new issuance is to support green transformation projects. They intend to allocate approximately 100 million euros for these projects in the period from 2024 to 2026, as announced by the company a month ago when they published the financial results for the previous year.

According to unaudited data, the Gen-I group generated just under 2.9 billion euros in revenue in 2023, which is 29.3% lower than the previous year, while its net profit decreased by 16.5% to 24.8 million euros. The decline in revenue was attributed primarily to lower energy prices and partly to reduced trading volumes as a result of temporary regulatory constraints in wholesale energy markets.

The volume of energy sold to end consumers decreased by 12% compared to 2022. Conversely, a significant increase in revenue was recorded in the segment of green technology sales. This year, the group plans to achieve 3.5 billion euros in sales revenue, with a net profit expected to reach 23 million euros.

The purchase of bonds means that the company is acquiring fresh funds, cash reserves, and is further indebting itself. It could also imply that new investors (creditors) may later convert their investments into ownership stakes. Consequently, this could theoretically mark the beginning of an intention to privatise the company.

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