The move to a joint-stock company, among other things, means that 15% of the shares will be distributed to citizens who are entitled to them without compensation. The first step in this journey will be the tendering of the property appraisal.
In the meantime, the Corporate Governance Reform Action Plan is being implemented, with the support of consultants from the European Bank for Reconstruction and Development.
“In 2020, we will change the legal status of EPS into a joint-stock company, in line with the ongoing process of corporate restructuring and financial consolidation, with the aim of improving the sustainability of the company and ensuring its professional management”, the letter of intent said.
As they state, “we have adopted a number of governmental decisions to establish ownership of all property and property of EPS. We will launch a tender to evaluate the assets of the company”.
Stock exchange expert Nenad Gujanicic explains that the corporatization of big companies is quite important, as it leads to more efficient control of business operations and achieving better results.
“This is especially pronounced for state-controlled companies, because in their case the influence of political parties in management is over-pronounced, leading to damage to the company itself and ultimately to taxpayers”, said Gujanicic, Momentum Securities’ Chief broker.
The transition to a joint stock company itself does not have to change anything if the form is done for the sake of doing so. Telekom Srbija has long been a joint stock company, but it has not been listed on the stock market, nor can minority shareholders holding almost 30% of ownership be able to exercise any influence.
The goal of transformation of the company into a joint stock company is indirect control of the business by the shareholders, in which the unavoidable step is trading these shares on the stock exchange. Novosti’s source points out that potential listing of the company and control of business would contribute to much better business results. In doing so, EPS could keep pace with the necessary investments and, in the long run, make a significant contribution to the state budget through dividend payments.
The listing of a company on the stock market determines its market value, which depends on the supply and demand for the shares. Being listed on the stock market does not necessarily mean that EPS will be privatized.
“A large number of world companies are listed on the stock exchange, and in them the state has a controlling action or dominant participation. Such is the case with Deutsche Telecom or the French EDF. Corporatization does not have to mean that any shareholder, whether dominant or majority, has to sell the shares it owns”, he says.
Whether the price of kilowatts in Serbia is realistic and sufficient will be checked in the first half of the year. This company must invest in expanding production capacity and meeting environmental standards.
“By June 2020, we will complete an assessment of electricity tariffs to fully ensure cost recovery, including the cost of increasing reliance on renewable energy sources”, the letter of intent states, reports Novosti.
