The Czech Finance Minister, Jiri Rusnok, said yesterday that he assumes the National Property Fund will solve the technical and legal issues regarding energy-sector restructuring plan until a June 11 CEZ AGM, so that the AGM can deal with the issue of the sale of CEPS, the transmission-grid operator, and the purchase of regional distributors between CEZ and the state, key components of the government plan. At Monday’s EGM the NPF rejected the above asset transfer as proposed by the CEZ board of directors (the NPF, a state institution, is the majority stake holder in CEZ).
The recent development seem to reflect growing political tension related to (i) the valuation of the relevant companies (CEPS and the state’s stakes in the distributors), the sales of which would be advantageous for CEZ, and (ii) energy-sector restructuring. The restructuring plan’s prospects worsened on Monday, and it is increasingly likely that, if the plan is soon realized, it could be undone after the general elections (June 14, 15). Therefore, CEZ stock’s increased volatility and vulnerability is expected in the short term.
(Jiri Soustruznik)