UPDATE 1-Hungarian-Czech group buys majority stake in Matrai power plant

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BUDAPEST, Dec 14 (Reuters) - A businessman friend of Hungarian Prime Minister Viktor Orban has teamed up with a Czech energy group to take a big stake in Hungary’s energy sector, where Orban has long been looking to wrest control from foreign owners.

Lorinc Meszaros’s Opus Global said on Thursday it had partnered with Prague-based EP Power Europe to buy a majority stake in Hungary’s Matrai power plant from German groups RWE and EnBW.

Meszaros, a childhood friend of Orban who has built a sprawling empire of more than 100 companies, has established himself as a key player in several industries in the country.

This is his first major investment in the energy sector, but more could follow as Opus said in a separate statement it would place a greater emphasis on acquisition targets in power production and trading.

The Matrai plant, with a capacity of 950 megawatts (MW), is Hungary’s second-largest electrical baseload power generator behind a nuclear plant in Paks.

It generates annual revenues of close to 100 billion forints ($377 million) and made a 2016 net profit of 33.4 million euros ($39.5 million).

Opus, in which Meszaros holds a 23.8 percent stake, said it was buying 72.66 percent of the plant in a 50-50 percent joint venture, called Matra Energy Holding, established with EP Power Europe, part of Czech company EPH Group.

The deal is pending regulatory approvals. Financial terms were not disclosed.

EPH has expanded around Europe in recent years, buying coal- and gas-fired power plants in Britain, Italy and Germany, betting heavily that coal assets in particular will continue to pay off despite Europe’s shift to renewable power.

EPH, whose companies now produce more electricity than Czech power giant CEZ, also has a stake in Slovakia’s largest utility Slovenske Elektrarne.

RWE and EnBW had been looking to sell their Hungarian unit at least since April, as part of a major restructuring effort.

Driven by a big drop in wholesale power prices across Europe, RWE has either shut down, mothballed or put on stand-by 11.5 gigawatts (GW) of its generation capacity since 2012.

The company on Thursday said the sale was in line with its strategy to focus on its core German, UK and Benelux markets.

At 1306 GMT, RWE shares were down 1.1 percent at 17.88 euros, while Opus’s were up 2.9 percent at 670 forints. Opus shares have jumped 16-fold this year, according to Reuters data.

Alongside Matra Energy Holding, the other major shareholder in the Matrai plant will be state-owned power wholesaler MVM, which also controls the Paks nuclear plant.

Hungary is due to break ground on a second Russian-built nuclear plant at Paks early next year.

($1 = 265.35 forints)

$1 = 0.8449 euros Additional reporting by Jason Hovet in PRAGUE and Christoph Steitz in FRANKFURT; Editing by Mark Potter