PRAGUE (Reuters) - The idea of splitting state-controlled Czech utility CEZ (CEZP.PR) is nonsense and would present several problems, Industry Minister Tomas Huner was quoted as saying on Friday.
CEZ, with a market capitalization of $13.2 billion, has been looking at ways to raise shareholder value by separating regulated assets such as renewable energy and distribution from traditional production in lignite and nuclear plants.
A plan under consideration would give the government, which holds a 70 percent stake in CEZ, full control of the traditional energy business and allow it to proceed with construction of a new nuclear power plant that CEZ has refused to undertake as a private enterprise without state guarantees.
Some minority shareholders have also been opposed to taking on the nuclear plant project.
“I think the split (of CEZ) is silly,” Huner said in an interview with the Hospodarske Noviny daily. “We can talk about splitting the firm once the impact on shareholders has been calculated.”
Huner said he did not understand why distribution would not be included with coal and nuclear assets and added that it remains unclear whether the proposed reorganization is the best option to finance new nuclear capacity.
In a separate interview with newspaper Mlada Fronta Dnes on Friday, CEZ Chief Executive Daniel Benes said the company was looking for solutions that would benefit all shareholders.
“We can, for example, internally separate assets to address investors who will want to invest into a modern, innovative energy firm but not in coal-fired plants,” Benes said.
“And alongside this, it can bring some advantages to the state because the other part of CEZ can fulfill the state energy plan, meaning nuclear power units.”
Benes told Reuters and Bloomberg news agencies in an interview this week that he would like a decision by mid-2018 on the company’s transformation plans.
A government committee is due to meet next week to debate the options of financing future nuclear power construction and make recommendations to ministers.
Reporting by Jason Hovet; Editing by David Goodman