FGC and IDGC Holding shares posts major gains on corporate news
MOSCOW. Nov 6 (Interfax) - Shares in Federal Grid Company UES and IDGC Holding posted major gains on the MICEX-RTS on Tuesday morning in reaction to news from last Friday about state plans to reorganize these grid companies.
By 12:27 pm Moscow time, shares in FGC UES had gone up by 4.7% to 0.2145 rubles, its highest point in two week while IDGC Holding rose by 3.7% to 2.03 rubles, the highest quotation since mid-October.
It was reported on Friday that Russia's Energy Ministry has put together a draft presidential order to form a managing company for the country's electricity grid system.
One source said that the managing company would be formed through OJSC IDGC Holding with the injection of shares in FGC into its capital. However, the two companies will not be merged.
Another source said that the option of forming a managing company through IDGC Holding was chosen since IDGC is already a holding and it would be feasible to integrate an operational structure, FGC, and making it a subsidiary. The source also said that the Energy Ministry has gone over several scenarios for merging the companies and decided that this type of reorganization would be the most economically feasible with the lowest costs.