Mumbai: Enel SpA, Italy's biggest power utility, has raised its stake in Russian power generation group OAO OGK-5 to 59.8 per cent from 37.2 per cent earlier.

Enel, based in Rome, said it paid 35.5 billion rubles ($1.5 billion) in an open offer for the Russian power generation company, valuing OAO OGK-5 at around 4,427.50 roubles per share, about 7 per cent more than the closing price the day before the tender was announced.

"It is a strategic presence for Enel in one of the largest markets undergoing liberalisation in the world, one with excellent prospects for the profitability of our investments," Enel CEO Flavio Conti said in a statement.

The Italian group was forced to make a public offer after it crossed the 30 per cent threshold last year in two separate transactions.

OAO OGK-5 has generating capacity of 8,672 megawatts with one plant each in central Russia and southern Russia and two in the Ural Mountains.

OGK-5 reported revenues of.75 billion roubles and net income of 1.2 billion roubles in the first half of 2007.

The Russian government will maintain a 25 per cent stake in OGK-5.

Enel said it has paid a total of R2.61 billion for its investment in the company.

Enel is offering Russian gas export monopoly Gazprom a minority stake in an Italian power plant as reciprocity for gas supplies to OGK-5, Conti said.

European utilities are trying to make inroads into Eastern Europe to tap its rich supply of resources and its growing economies.

Last year Germany's E.ON AG picked up a minority stake in another Russian power company OAO OGK-4, while Finland's Fortum Oyj agreed to pay $4.1 billion for OAO TGC-10, last month.