A further delay to the privatisation of the Czech power company CEZ has emerged following a holdup in a deal to provide the company with a range of distribution assets. The state National Property Fund, which holds a 68 per cent stake in the company, has announced that it wishes to delay the distribution asset transaction until any legal obstacles have been removed, Reuters reports. No new schedule has been announced.
The Czech government has already agreed to sell stakes in eight regional power distribution companies to CEZ, giving the company direct access to customers in the power market. In exchange CEZ will transfer control of the high voltage transmission system to the state. The new delay means that the deal is unlikely to be completed before the June parliamentary elections. This is likely to affect the timetable for privatisation.
One sticking point is a golden share which the state owns in the distribution companies. Some politicians have also criticised the deal, saying the CEZ would become too dominant in the power market, and that this could hurt customers.
Earlier this year the Czech government tried to sell a 66 per cent stake in CEZ. The sale failed because it established a minimum price of $5.5 billion which the leading bidders considered too high. Transferring distribution assets to the generator will make it more attractive, the government hopes.
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