Both Finance Minister Bohuslav Sobotka and Deputy PM Martin Jahn spoke in favor of selling the state’s 55% in Severoceske doly (SD) to CEZ. The plan, which assumes giving CEZ exclusivity in negotiations, is to be submitted to the government very soon, while the government should discuss it by the end of July. While we would view a CEZ purchase of SD as positive for CEZ from the strategic point of view, we believe that CEZ is not under any pressure to pay a high price for SD, in particular as it has already secured long-term coal supply contracts with both SD and Mostecka uhelna.
Separately, CEZ wants to squeeze out minorities in its five distribution companies in order to press ahead with its restructuring plan.