July 28, 2016 / 7:55 PM / 2 years ago

French CDC in talks to buy 49.9 percent stake in EDF power grid unit

A view shows the State-controlled bank Caisse des Depots (CDC) headquarters in Paris, France, July 28, 2015. REUTERS/Stephane Mahe

PARIS (Reuters) - French utility EDF (EDF.PA) has entered exclusive talks with state-owned bank Caisse des Depots and its unit CNP Assurances to sell them a 49.9 percent stake in power grid unit RTE, it said in a statement on Thursday.

EDF said the deal would be done on the basis of an indicative value of 8.45 billion euros for 100 percent of RTE’s equity and that it could close in the first half of 2017, once regulatory approvals have been obtained.

Markets have long speculated about a partial sale of RTE, which is complicated by the fact that under a 2004 law, RTE’s capital must be held by EDF or other public entities.

EDF holds the other half of its RTE stake in its nuclear provisions fund, in which it ringfences investments that will cover the cost of decommissioning its French nuclear reactors in coming decades.

Earlier this year, the French government had asked EDF, which is 85 percent state-owned, to sell up to half of its 100 percent stake in RTE - Europe’s biggest electricity transmission network operator - in order to help finance a project to build nuclear reactors in Hinkley Point, Britain.

In line with EU regulations on power grid independence, EDF has no management control over RTE, which needs to be independent and must guarantee equal access to its power network to all power producers.

Reporting by Geert De Clercq; Editing by Richard Lough and Robin Pomeroy

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