Marketsโ Unmoved by Czech Minister’s CEZ Share Price Indication,Nationalization Faces Hurdles
Prague,Czech Republic – โฃCzech โEnergy Minister Karel Havlรญฤek‘s suggestion of aโข 880 CZK price per share for CEZ,the country’s largest energy provider,failed to impact market confidence,according to reporting by Seznam Zpravy. The proposal comes amid ongoing debate over โpotential nationalization of CEZ, a move โฃchampioned by โขformer Prime Minister andrej โคBabiลก’s YES party.
Minority shareholderโฃ Michal ล nobrโ argues CEZ possesses the financial capacity to repurchase its own shares, potentially circumventing a direct state buyout, stating the company “is in debtโ and โat any time to pay off to shareholders or use it to buy its own shares.”
However, CEZ management reportedly favors โpresenting the next government with options to โฃlower electricity prices – a keyโฃ promise of the YES nationalization plan – rather than a โshare buyback.”CEZ can submit toโข the governmentโ reserves on how to reduceโค theโข price of electricity,”โ a well-informed energy source revealed. Potential adjustments wouldโ target fees embedded in electricity bills, including distribution costs, contributions to supported energy sources, system services, and infrastructure maintenance.
A share repurchase โwould negatively โคimpact CEZ’s financial standing,โฃ increasing financing โcosts, according to analyst โขPavel Pfeiler. โค
nationalization efforts โฃface critically important obstaclesโข from key minority shareholders, notably entities linkedโฃ to the J&T group and billionaire Pavel Tykaฤ,โข owner of Sev.en. Acquiring a 10% โฃor greater stake from these investors would beโ crucial for a successful squeeze-out, dramatically increasing the overall cost. “It will cost such a packโฃ of money that it would be complete madness,” warned a source,suggesting the โprice would exceed current market valuations.
The โprospect โคof compensating billionaire investors with state funds also presents a political challenge for Babiลก, given his historically complex relationshipโ with โTykaฤ.
