BUSINESS

Avax to sell electricity arm

Avax to sell electricity arm

Construction group Avax is proceeding with the sale of electricity supplier Volterra. The group’s management is locked in negotiations with interested buyers in order to divest from this activity in the energy sector.

Sources estimated on Wednesday that Avax will have unloaded Volterra within the next couple of months. That move is attributed to a series of reasons, the main one being the conditions that have emerged in the electrical energy retail sector.

According to what the group mentions in its annual financial report, “the natural gas rate hikes during 2021 resulted in a considerable increase in the processing prices in the domestic energy market.” Adhering to the procurement regulations resulted in delays in the harmonization of charges for clients, generating significant losses for the group.

Avax added that “the major increase in the turnover of Volterra and the increase in market rates have resulted in the soaring of working capital requirements; Volterra was unable to handle that and it required considerable support from its parent company,” the group admitted.

It is therefore only a matter of time before Avax divests from the electricity sector, at a time when the industry is going through a process of concentration.