Barclays Capital to advise on Bord Gáis sale options

THE NATIONAL Treasury Management Agency (NTMA) has appointed an external company to advise on the sale options for Bord Gáis.

Barclays Capital has been hired by NEW Era, the NTMA division that manages the Government’s stake in semi-State assets, to advise on potential privatisation options for the semi-State entity.

The appointment follows a beauty parade of potential advisers last month.

The process will most likely include a valuation of the business. Any sale may involve splitting up Bord Gáis.

Minister for Communications Pat Rabbitte has said he would favour selling the semi-State’s energy business in some circumstances, but not its natural gas network, which the Government views as strategically important to the State.

He said that a sale of Bord Gáis’s energy division would be “compatible with our objectives” if it attracted a big player into the market.

The Government is obliged to sell off some State assets as part of the IMF-EU bailout programme.

While the Government has committed to raising up to €2 billion in State assets, it is expected to approve more than €3 billion of disposals.

In its most recent meeting with the troika, the Government secured concessions from its lenders that some proceeds from the sale of State assets would be reinvested in the economy and not just used to pay down debts.

The Government is set to consider two reports into the sale of State assets next week – one on the ESB, and the other on all other assets, such as Dublin Port, Coillte, parts of Bord Gáis and its stake in Aer Lingus.

The possible sale of some of the ESB – the largest semi-State – is expected to be discussed in the coming weeks.

While there have been some indications that the Government make seek to offload a 25 per cent stake, this may prove a stumbling block for private investors who may demand a greater percentage.

NEW Era is a specific division of the NTMA which was established by the Government last September to manage the Government’s holdings in commercial State assets from a shareholder’s perspective.

It has a specific remit to carry out advisory roles in relation to the possible restructuring or disposal of commercial semi-State company assets as required under the EU-IMF programme.