April 24, 2019 / 9:50 AM / 2 months ago

Bulgaria's financial regulator to check Eurohold over CEZ deal

SOFIA, April 24 (Reuters) - Bulgaria’s regulator said on Wednesday it was examining Eurohold to establish its financial situation given its bid to acquire the Bulgarian assets of Czech utility CEZ.

Eurohold, active in insurance and asset management, entered into exclusive talks to acquire CEZ’s assets in the Balkan country that include a power distributor that provides electricity to more than 3 million Bulgarians last week.

“The key objective is to check the financial situation and the capacity of the holding company in relation to future acquisitions, including CEZ Distribution Bulgaria and CEZ Electro Bulgaria,” Bulgaria’s Financial Supervision Commission said in a statement.

“By law, power distributors are part of the European critical infrastructure with a direct relation to national security,” it said, adding that it would also carry out checks at key companies that are part of Eurohold.

Electricity costs are politically sensitive in the Balkan nation of 7.1 million people that is one of the poorest in the European Union.

In 2018, CEZ signed a contract to sell its assets in Bulgaria to local energy company Inercom, but Bulgaria’s anti-monopoly regulator blocked the deal five months later. The deal was estimated at 320 million euros ($362 million) at the time.

CEZ terminated the contract with Inercom this month, blaming Bulgaria for the failure of the deal. (Reporting by Tsvetelia Tsolova Editing by Edmund Blair)

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