Petrom, the largest Romanian company, has relinquished the remaining 6% stake it held in Butan Gas Romania, the group's domestic branch with international activities on the LPG (liquefied petroleum gas) segment, originally established by businessman Iosif Constantin Dragan.
The transaction was finalized at the end of last year, after Petrom took over the operations of Shell Gas Romania and its stake in Butan Gas declined from 43% to 6%. In 1996, Petrom and Butan Gas had formed a joint venture, which enabled Butan Gas to use Petrom's extensive national network to distribute its products.
"The acquisition of Petrom's stake in Butan Gas Romania was completed fairly recently. Since Petrom entered into a joint venture with us, their stake has gradually declined from 43% to 6%. Such being the case, it was a logical step for Petrom to exit this business, especially when it took over Shell Gas Romania," said Florin Preda, general manager of Butan Gas Romania.
The decline in Petrom's stake was the result of the company not taking part in the capital increases that provided funding for the development of Butan Gas on the local market. Additionally, according to company officials, the business model adopted by Butan Gas entails the full reinvestment of profit, and no dividend payments.
The company representative was unable to disclose the value of the transaction.
The group's planned investments on the LPG segment amount to 15.5 million euros, compared with last year's value of 9.5 million euros.
Butan Gas currently holds a 19% market share, but intends to increase this figure to 23% through network expansion, rather than through acquisitions.
In addition, Preda admitted they were in advanced negotiations with several companies in view of a potential acquisition, but he did not provide any further details on the matter.
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