According to CEZ’s M&A director Vladimir Schmalz, the negotiations to acquire Mostecka Uhelna (MUS) coal mines ended and there is no offer currently in the discussion. CEZ has started to work on other sources, i.e. gas for its planned new power plant in Pocerady. On the other hand, according to HN daily’s unnamed source close to MUS owners says that negotiations are still in process and the agreement is not ruled out.
Our view: At the end of 2007 CEZ indicated that negotiations are back at point zero and that it starts working on alternative fuel for its Pocerady plant. As a result we expect market has already priced in this and if any negotiations are still under process, this could be only a positive surprise for the market. Nonetheless, we don’t expect any outcome in the short term regarding this issue, thus we see this news as neutral.