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3CZ - CEZ Distribution Bulgaria AD News Story

BGN256 4.0  1.6%

Last Trade - 15/01/21

Small Cap
Market Cap £224.3m
Enterprise Value £239.6m
Revenue £170.9m
Position in Universe 146th / 638

UPDATE 1-Bulgaria wants controlling stake in CEZ's Bulgarian assets

Thu 1st March, 2018 1:45pm
(Adds CEZ, Czech PM comments, Transparency Intl statement)
    SOFIA, March 1 (Reuters) - Bulgaria's government wants a
controlling stake in the Bulgarian assets of Czech utility CEZ
 CEZP.PR , which are being sold, Finance Minister Vladislav
Goranov said on Friday.
    CEZ has signed a contract with a small Bulgarian solar
energy producer, Inercom, to sell a power distributor that
provides electricity to over three million Bulgarians, along
with other assets  urn:newsml:reuters.com:*:nL8N1QD3QF.
    The deal has raised concerns in Bulgaria over Inercom's
ability to finance and operate strategic energy assets
    "The talks are at quite an early stage. We expressed clearly
our will that we want to participate in this deal, one way or
another," Goranov told reporters after a meeting between Prime
Minister Boyko Borissov and Inercom's owner, Ginka Varbakova. 
    When asked what stake Bulgaria would like to have, Goranov
said, "at least a controlling stake."
    The deal, whose value was not disclosed but is estimated at
around 320 million euros ($390 million), has drawn headlines in
both countries. Transparency International also said on Thursday
the deal "raises red flags" and worries over the sources of
funds for its financing.
    "Governments must ensure that state-owned enterprises and
companies providing essential public services are held to the
highest standards of transparency and accountability," said
Patricia Moreira, managing director of Transparency
    Czech Prime Minister Andrej Babis said in a statement he had
talked to Borissov and told his counterpart that CEZ management
had assured him that, after its checks on Inercom and its
financing, there was no reason the deal should not go through.
    Inercom's Varbakova said she was leaving for Prague to hold
talks with CEZ and she was willing to let the Bulgarian state in
on the deal, provided that CEZ agrees.
    "If it will calm down the final consumers, yes, I am willing
to accept state participation in the deal. I am willing to
transfer the contract I have if the seller would agree to that.
These talks are pending," she said.   
    CEZ, though, said it had no information on Bulgaria's
intention to take a controlling stake in the assets. A spokesman
said the company would wait to hear from Inercom but added the
contract was already signed.    

($1 = 0.8213 euros)

 (Reporting by Tsvetelia Tsolova in Sofia and Jason Hovet in
Prague, editing by Jane Merriman, Larry King)
 ((tsvetelia.tsolova@thomsonreuters.com; +359-2-93-99-731;))
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