WHY THIS WHITE BOOK?

EVN wants to give full transparency regarding all facts and arguments connected with our investment in the Republic of Macedonia. We are convinced, that transparency and the full disclosure of important documents is an essential precondition to allow all interested people and institutions to follow this case and to build their own position. And we are totally sure, that a complete and true picture of all the things that happened, gives us the best protection.

This WHITE BOOK will be further elaborated, whenever new facts or evidences are available, we will disclose all relevant information and we will timely react on all events, information, misleading statements and/or wrong accusations brought against us further on. So it should also serve as a constantly growing and actualized documentation for everyone, who wants to follow the case or who needs the information for professional purpose.

This WHITE BOOK should not prevent anyone, who has open questions, to ask us directly and personally, but it should serve as an easy to find primary source for the original documents that are frequently mentioned in the public discussion or which were used in court, or the knowledge of which in its original wording is essential to understand the case.

So please use at any time www.evn.com.mk to get access to the entire WHITE BOOK and belakniga@evn.com.mk to ask any question. In case of problems, please call + 389 (0)2 3214 752.

This WHITE BOOK covers the facts primarily issue by issue and in a chronological way, giving explanations and evidences plus the respective documents.

Short outline
Following the process of restructuring of the former fully integrated Energy Company ESM into the companies MEPSO (Transmission Grid Operator) as of 31.12.2004, Negotino (Thermal Power Plant), ELEM (Production) and ESM Distribucija as of August 31st 2005, the Contract for regulating the mutual relations between ESM, ELEM and TEC Negotino was signed. A first valuation of the company that should be privatized was made by Meinl Bank, the advisor of the government, showing an enterprise value for ESM Distribucija of maximally only 35 to 70 mio EUR, a very disappointing fact. So the advisors should propose measures to increase the value. The result was, to finally settle the intercompany relations with an Annex Agreement, ordered by the government in the closed session on November 27th  2005 and signed by ELEM and ESM on December 5th 2005. By doing so, ESM was freed of any open debt towards ELEM. As a result, the government internally decided for a minimum purchase price of ?160 Mio. As next step the tender for selling of the 90% of the shares of AD ESM Distrubution was launched on December 9th 2005.
EVN AG has taken part in the due diligence during which the Government assured and guaranteed that the company had no debts towards ELEM. This was also shown in all balance sheets and was confirmed in letters of ELEM to the Ministry of economy and to KPMG. EVN gave the highest bid (225 Mio ?) and executed the Share Purchase Agreement, which was prescribed by the Government.
After the change in Government the first problems started, many discriminatory actions and constantly mounting pressure against EVN have occurred so far.

Additionally, we can not understand the attempts to wrongly locate the essence of the problem towards EVN in the issue whether EVN AG Austria has invested funds in the company EVN Macedonia. EVN AG has fulfilled its obligations in accordance with the Share Purchase Agreement and enabled through sponsor support guarantee EVN Macedonia to get the funds necessary for the investment (Detailed evidence shown in KPMG letter of June 5th, 2009). We have clearly shown, that EVN has fulfilled the investment obligation, which was confirmed by KPMG and we are ready for arbitration before objective, international forums, like in London, if the Government thinks otherwise.

So we are also disclosing all respective evidences for that in this WHITE BOOK.
We are at disposal for any further clarifications.

CHRONOLOGY
IMPORTANT DOCUMENTS
IMPORTANT LINKS
INTRODUCTION – THERE WAS NO DEBT TOWARD ELEM
CLAIM FROM ELEM AND THE PROCEDURE IN THE FIRST INSTANCE COURT
IMPROVEMENTS THROUGH INVESTMENTS
ARBITRAGE IN WASHINGTON
ENERGY LAW
CINGOVSKI AND ELEM
FALSE AND MISLEADING STATEMENTS
OPERATIONS OF EVN MACEDONIA
INTERVIEWS, COLUMNS & MEDIA REPORTS