Rurelec gets 142m dollar valuation on Bolivian assets
Power generation company Rurelec says independent experts have valued its former assets in Bolivia at 142.2m dollar - the news comes as the company prepares for arbitration following a nationalisation programme in the Latin American country.
Power generation company Rurelec says independent experts have valued its former assets in Bolivia at 142.2m dollar - the news comes as the company prepares for arbitration following a nationalisation programme in the Latin American country.
Rurelec has now submitted the figure as part of its claim before the Permanent Court of Arbitration in The Hague.
The Bolivian government forcibly transferred Rurelec's subsidiary, Empresa Guaracachi, to the state power firm, ENDE, on May 1 2010 as part of the so called "May Day" programme which brought into state ownership all three of the private power generation companies.
Subscribe to MoneyWeek
Subscribe to MoneyWeek today and get your first six magazine issues absolutely FREE
Sign up to Money Morning
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
There is an existing treaty between the UK and Bolivia which the firm says "protects all British companies and guarantees payment of market value in the event of compulsory state nationalisation".
Peter Earl, Chief Executive of Rurelec, said: "I am pleased to report that the $142.2m valuation of our total claims vindicates our efforts to seek full compensation for the loss of Guaracachi. We hope that Bolivia will now pay the compensation that it owes Rurelec for the nationalisation of Guaracachi to enable the Rurelec group to reinvest in replacement power generation assets in Latin America.
He added: "In the event of a settlement, we are committed to using part of any proceeds to a significant buy-back of Rurelec shares in order to reverse some of the equity dilution suffered by shareholders".
Rurelec shares had gained 1.3% by 11:39 in London. Since the nationalisation, the stock has dropped 35%.
BS
-
FTSE 100 hits record highs – why is it rising and will we see more gains?
Advice UK equities have been described as unloved for a long time but as the FTSE 100 hits new highs, we explain if now is the time to buy British.
By Marc Shoffman Published
-
How to invest in copper
It may be time to invest in copper as the red metal appears poised for a big jump. Dominic Frisby looks at what should investors should buy
By Dominic Frisby Published