Yesterday Dresser-Rand (NYSE:DRC) shareholders took a 8% haircut because of a rather confusing note issued by the company. Only one detail was immediately clear: The looming impairment charge and profit reduction due to potential implementation of a new Spanish regulation that, if adopted, would significantly reduce beneficial tariffs for Dresser-Rand's plants in Spain.
The Company owns and operates six pig manure treatment facilities in Spain, which operated under the Electrical Special Regime tariffs. The Spanish government recently published a draft regulation that reflects a reduction in the tariffs of approximately 37%, which, if enacted, would be retroactive to July 2013. In view of the pending change in the tariffs, the Company has decided to suspend the operations at...
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