Czech utility CEZ's strategic assets must stay in state hands -PM Babis

Babis last month said he would appoint an expert team to assess a proposal to split 70 percent state-owned CEZ into a traditional generation firm with nuclear- and coal-fired plants and a new company housing renewables and other assets.
Andrej Babis
Andrej Babis
PRAGUE: Any split of Czech utility CEZ should include keeping strategic assets like sales and distribution in state hands, Prime Minister Andrej Babis said on Monday.

Babis last month said he would appoint an expert team to assess a proposal to split 70 percent state-owned CEZ into a traditional generation firm with nuclear- and coal-fired plants and a new company housing renewables and other assets.

Under proposals discussed by the state, distribution could fall into the "new energy" company, whose shares -- up to a majority - would be offered to investors. The government would take full control of the "old energy" company focussed on production from nuclear and lignite sources.

"A serious debate is ahead of us and the interests of the states must be crucial," Babis told a meeting of the economic chamber on Monday, according to CTK news agency.

Splitting CEZ, the biggest Czech listed company with market capitalisation of $13.2 billion, is one option being considered for financing the construction of a new nuclear power plant.

Babis had earlier fully opposed the split, saying before an October parliamentary election that the move would cost customers. In December, he said it would unacceptable to sell off sales and distribution.

Babis's party handily won the election last autumn but has struggled to install a government. A minority cabinet led by Babis failed a confidence vote in January, but he remains in office pending talks on a new administration with the leftist Social Democrats and the far-left Communist party.