The Argentine government announced the intervention of the Italian-owned electric company Edesur, after weeks of massive power cuts.
The Italian Enel controls 75 percent of Edesur, which is one of the two largest distributors in Argentina and has already announced that it wants to sell the company and withdraw from the third largest economy in Latin America. But until that happens, it will have the government administratively controlling its operations for at least the next six months.
"We want to certify that the works that have to be done are done," said the Minister of Economy, Sergio Massa, when announcing the intervention to Edesur. "The ownership of the shareholders or the concession contract are not affected," he added.
Massa said he believes that Enel's decision to withdraw from the company is affecting "somehow" the provision of the service. Edesur has already been criminally denounced by the Argentine government, accused of "abandonment of person" in the midst of power outages that left between 150,000 and 200,000 people without electricity for days in the midst of one of the most intense heat waves in recent decades .
Edesur has made it known unofficially that the rate delay imposed by the Argentine government for years is one of the reasons why the service has dropped in quality. The government, however, states that Edenor, the other large electricity distributor in the Buenos Aires metropolitan area, is under the same tariff framework and offers a much superior service.
"The concession was established for 99 years and it has 69 years left on the contract," recalled La Nación. "The concessionaire has guarantees there that would be seen in his favor in the international court of arbitration. The majority controlling company is the Italian Enel, which announced the sale of 51% of the shares as of April, through Banco Santander" .
The Edesur controller on behalf of the government will be Jorge Ferraresi, former Minister of Housing and known for his political closeness to Vice President Cristina Fernández de Kirchner.
Maurizio Bezzeccheri, director of Enel, told "La Nación" that if the government wants to take away the concession, it can do so, but that from then on it will face a lawsuit in international arbitration courts.
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