VS Energy, which owns four majority stakes of over 90% and four minority stakes in Ukrainian distribution companies declares that negotiations failed on CEZ’s proposed price as VS Energy expects reportedly USD 700 – 900m. However CEZ claims that talks are not over yet. CEZ has exclusivity negotiations until the beginning of September. Source CTK
Ukraine falls into CEZ’s targeted region and as the economic growth of Ukraine will drive the electricity consumption higher we see CEZ’s efforts there as obvious mainly in the context of the size of this market. We estimate the value of the assets for USD 490 – 540m. As we mentioned previously, CEZ has to carefully consider deals in the region and not to overpay them, given mainly the fact that prices increased several fold in past two years there.