Magma Completes HS Orka Purchase, Despite No Government Approval - The Reykjavik Grapevine

Magma Completes HS Orka Purchase, Despite No Government Approval

Published September 6, 2010

Magma Energy has completed purchasing its 98.5% stake of HS Orka, despite the fact that the Icelandic government put a freeze on the sale at the end of July until a committee comes to a conclusion on the legality of the sale. This marks the second time the company has willfully defied the Icelandic government.
Last month, Magma Energy announced that their puppet company – Magma Energy Sweden, created to circumvent Icelandic investment laws – now holds an 84.21% interest in HS Orka. They added “Magma Sweden’s previously announced agreement to acquire Geysir [Green Energy]’s remaining 14.32% interest in HS Orka has not yet closed and remains subject to certain outstanding closing conditions, which are expected to be met in the near term.”
Those “certain outstanding closing conditions” would include the fact that last July the Icelandic government put a freeze on the transfer of ownership of HS Orka pending the findings of a government committee investigating the legality of the sale.
Now Magma has announced last Friday that it had completed the purchase of HS Orka.
Magma did let recipients of the press release know that “the government of Iceland may take steps to invalidate or wind-down the prior privatization of Hitaveita Sudurnesja (now HS Orka); the government of Iceland may pass legislation or constitutional amendments to nationalize or restrict private or foreign ownership in Iceland’s energy sector”.

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