SEB banka issues financing of more than EUR 130 million to AST

SEB banka has signed loan agreements with joint stock company AS “Augstsprieguma tīkls” (AST) on the granting of financing in the amount of EUR 116.2 million as well as an overdraft agreement for EUR 20 million.

AST will use the attracted financing to refinance the liabilities of AS “Latvijas elektriskie tīkli” (LET) following the investing of the shares of AS “Latvijas elektriskie tīkli” (LET) in the share capital of AST. The next contemplated step is merging of LET into AST by 31 December 2020 . Thus, the process of taking over of AST assets from Latvenergo AS (Latvenergo) Group, which lasted for a number of years and was aimed at ensuring that the new electricity transmission system management model became operational as of 1 July 2020, has been completed.

Ints Krasts, member of the Board of SEB banka: ”This is a strategically important project not only for us as the leading financier of companies in Latvia, but also for the country as a whole, because AST has therefore become an independent unaffiliated transmission system operator. We are pleased that our bank was chosen to be engaged in this important transaction, which has been one of the biggest financial transactions in the banking sector lately and which supports that we are a reliable counterparty for our long-term customer. Conversely, for us as one of the largest market participants in the Latvian financial system, this transaction has shown that we can use our knowledge and experience to provide support in the projects of national significance aimed at the development of critical resources such as the electricity transmission system.”

Varis Boks, Chairman of the Board of AST: “SEB banka has been a long-standing counterparty of AST and offered the best financing model for AST and Latvian electricity consumers. In addition, we do appreciate our successful cooperation. The refinancing of the liabilities taken over from LET will enable AST to implement the planned development projects more efficiently as well as result in financial savings in the development of the transmission network.”

Since 2011, when the Member States of the European Union (EU) had to separate transmission system operators from the historical energy supply monopolies, AST has been carrying the function of the transmission system operator, while the assets necessary for the operation were leased from the LET. During the reorganisation process, AST will also take over all the liabilities of LET. From the viewpoint of energy policy implementation, this is a rational step in the functioning of the transmission system, as well as the development of the electricity market and further integration within the EU.