Bulgarian energy regulator clears sale of CEZ's Bulgarian assets to Eurohold (updated)

EuroHold Bulgaria AD

19/01/2021 14:04

(Adds Eurohold comment, details, background)
    SOFIA, Jan 19 (Reuters) - Czech utility CEZ  CEZP.PR  has
won regulatory approval to sell its Bulgarian assets to local
financial group Eurohold  4EH.BB , Bulgaria's energy regulator
said on Tuesday, clearing a long-delayed 335 million euro
($406.22 million) deal.
    CEZ, central Europe's largest list utility, has been seeking
to pull back from most foreign markets and focus more on growing
its renewables and energy services businesses, including in
neighbouring Germany.
    The sale of its Bulgarian assets follows a deal to sell its
Romanian operations to Macquarie Infrastructure and Real Assets
(MIRA).  urn:newsml:reuters.com:*:nP7N2FD009
    Eurohold said it wants to create a leading regional utility
and that it has now obtained all regulatory approvals for the
deal, which was struck in June 2019 but was initially blocked by
the competition regulator.
    Under the deal, Eurohold will acquire 67% stake in a power
distributor that provides electricity to more than two million
people in Bulgaria, an energy trading company as well as a solar
park and a biomass-fired plant and an IT company.
    Shares of Eurohold jumped 12.85% on the Sofia bourse after
the Bulgarian energy regulator issued a statement saying it had
approved the deal.
    CEZ shares were little changed at 539 crowns per share but
have found support in recent months from prospects of a higher
dividend due to the asset sales.  
    Eurohold said it would finance the acquisition through a
combination of equity and borrowed capital provided by leading
global investment banks.
    It did not provide a timeline, but sources close to the deal
told Reuters it should be completed in the second quarter.  
    "We have the support of global investment banks with solid
experience in providing financing for such deals. After the
completion of the acquisition, we will aim at developing a
leading regional utility company," Vasil Stefanov, head of
mergers and acquisitions at Eurohold Bulgaria said in a
statement. 
    The deal in Bulgaria hit a roadblock in October of 2019,
when the anti-monopoly regulator said it would hinder
competition in the country - a move that at the time critics saw
as politically motivated.  urn:newsml:reuters.com:*:nL8N2FX2A4 urn:newsml:reuters.com:*:nL5N279762   
    After a Bulgarian court ruled that the anti-monopoly
regulator must review its decision, that regulator allowed the
deal last October.  urn:newsml:reuters.com:*:nL1N2HK2S6 
    
 ($1 = 0.8247 euros)

 (Reporting by Tsvetelia Tsolova, editing by Louise Heavens and
Susan Fenton)
 ((tsvetelia.tsolova@thomsonreuters.com; +359-888-311-435;))