CEZ shareholders approve carving out distribution as lead-up to sale, share buyback

CEZ as

01/06/2026 19:41

Plan is first part of wider restructuring 
CEZ plans to sell minority in new distribution, sales subsidiary
Company expects to lure wider investor base into the regulated assets
Would create war chest for buyback of private minority owners
Successful buyback would give state full control of parent firm
Government wants to control production, nuclear development  
By Jan Lopatka
PRAGUE, June 1 (Reuters) - Shareholders in Czech energy utility CEZ CEZP.PR approved on Monday carving out its electricity and gas distribution networks, in a first step towards a wider restructuring that the government hopes will lead to full state control of the country's main power plants.
The plan, approved by shareholders led by the government, which holds a nearly 70% stake, calls for the separation of the distribution networks, trading and customer sales which together made up 40% of last year's 137 billion crowns ($6.56 billion) in earnings before interest, taxes, depreciation and amortisation (EBITDA). That proportion is expected to rise. 
The approval also authorises the potential sale of a 49% stake in the new subsidiary to investors once the spin-off process is completed in early 2027, through a stock listing, trade sale or otherwise.
CEZ and energy sector analysts say the separation should unlock value in the regulated assets, which typically trade at higher multiples of earnings than energy production, which faces volatile commodity prices. 
It could also draw in investors who have shunned CEZ because it operates nuclear and coal power plants in addition to its gas and renewable sources, CEZ has said.
"Taking into account the valuations of companies in the same sector and corresponding debt, we estimate that CEZ could receive up to 250 billion crowns ($12 billion) for its 49% stake" in the new subsidiary, Komercni Banka said in a report.
CEZ's entire market capitalisation - including highly profitable nuclear power plants - is $32 billion at the current share price. 
        
BUY-BACK LIKELY TO FOLLOW
The sale would create a war chest for the parent CEZ for a government plan, yet to be formally approved, which counts on CEZ to subsequently buy back its own shares held by minority investors, leading to full state ownership of the parent firm. 
The stated aim is energy security, as well as the development of nuclear plants, given long timelines and large investment costs that private investors refuse to bear without state backing.
Minority shareholders include billionaire energy investor Pavel Tykac with 3%, investor Tomas Kanka, Chase Nominees, PPF Banka and BlackRock, according to the firm's 2025 annual report and central bank filings. 
The government must gain at least a 90% stake to trigger a squeeze-out of the remaining shareholders.
($1 = 20.8820 Czech crowns)

 (Reporting by Jan Lopatka; Editing by Hugh Lawson)
 ((jan.lopatka@thomsonreuters.com; +420 234 721 614; Reuters Messaging: jan.lopatka.thomsonreuters.com@reuters.net/))