20 May 2002 – Czech utility CEZ is to pay 21bn koruna ($632m) to the government to acquire controlling interests in eight electricity distribution companies as part of a transaction in which ownership of the electricity transmission company CEPS will pass to the government.
The figure is higher than his previously estimated CZK17bn billion as it includes CZK4bn in taxes, said CEZ General Director Jaroslav Mil on Monday.
An EGM later today is expected to pass the transaction, which will be the largest in CEZ’s history. The contract between CEZ and the government is expected to be signed in coming weeks.
The move to reorganize CEZ into a vertically integrated utility came after the government cancelled its proposed privatization of CEZ earlier in the year. The plan to sell-off CEZ as one unit failed to attract a satisfactory level of bidding from foreign investors.
CEZ plans to focus on cutting costs at the regional distributors in the coming months. Chulak said end-users are likely to see a decline in the price of electricity as a result of the consolidation, but he didn’t give specific details.
The Czech government is expected to sell off the transmission company Ceska prenosova soustava, or CEPS in line with European Union directives.