Karapetian camp says it will reject government offer for Armenia’s power distributor

A representative of billionaire and opposition leader Samvel Karapetian said on Friday that he will reject the Armenian government’s offer to acquire Electric Networks of Armenia (ENA), escalating a months-long confrontation over the country’s power distribution utility.

Prime Minister Nikol Pashinian called for ENA’s nationalization last June, hours after Karapetian was arrested on charges stemming from his strong criticism of what he described as a crackdown on the Armenian Apostolic Church.

Karapetian was later charged with tax evasion, fraud and money laundering following his decision to form a political group, which is now expected to be the main opposition contender in Armenia’s June 7 parliamentary elections. Moved to house arrest in late December, he denies all accusations as politically motivated.

The government forcibly took over ENA’s management in July, accusing its parent company—owned by Karapetian’s Moscow-based Tashir Group—of mismanaging the network. Tashir rejected the allegations and appealed to the Arbitration Institute of the Stockholm Chamber of Commerce.

On November 17, Armenia’s Public Services Regulatory Commission revoked Tashir’s operating license, a decision that allows ENA to be nationalized if the parties fail within three months to agree on a sale to another investor. In a formal proposal dated February 17, the government valued ENA, which employs thousands, at 23.3 billion drams ($62 million).

According to a copy of the proposal, payment of that sum is conditional on Karapetian and his family returning about 23.2 billion drams in dividends from ENA profits paid over the past decade, leaving a net gain of 142 million drams ($380,000). “Of course, we will not accept the proposal,” said Davit Ghazinian, who managed ENA until the government’s takeover.

He dismissed the offer in stark terms, saying no rational person would accept it. Under Armenian law, Tashir has three months to respond formally to the government’s proposal. Citing that provision, Armenia’s Administrative Court recently barred the government from nationalizing ENA before May 25.

The government will have to compensate Tashir even in the likely event of nationalization, which Karapetian’s group will almost certainly challenge in court. Separately, Tashir is seeking $500 million in damages for what it calls an illegal expropriation of Karapetian’s largest asset in Armenia.

Last summer, the Stockholm arbitration body ordered Armenian authorities to refrain from seizing ENA, changing its top management or revoking Tashir’s license pending a verdict in the case. The authorities ignored the order. The immediate next step is Tashir’s formal reply to the government’s offer before the three-month window closes.

With the court’s bar in place until May 25 and parliamentary elections set for June 7, the ownership and control of ENA remain a central—and litigious—issue in Armenia’s political landscape.