Finnish utility Fortum has decided to sell its stake in Russian energy company Lenenergo for approximately EUR 295 million to VTB Bank, I.D.E. Electricity Distribution Investments 1 Ltd and the Russian energy company UES.

The holding of slightly over a third of Lenenergo shares will see Fortum book an after-tax gain of approximately EUR 230 million.

The decision to sell the Lenenergo shares is in line with Fortum’s strategy to invest primarily in Russian generation assets. The current business of Lenenergo is electricity distribution in the city of St. Petersburg and the Leningrad Region.

The generation assets of the original Lenenergo were integrated to the north-western Territorial Generating Company, TGC-1, in 2006 as a part of the Russian power sector reform. With its stake of slightly 25%, Fortum is the second largest shareholder in the company.