Czech CEZ offers EUR 450mn bonds exchangeable for shares in Hungary’s MOL.

By bne IntelliNews January 28, 2014

Czech energy group CEZ has announced an offering of EUR 450mn worth of guaranteed bonds due in 2017 and exchangeable for existing shares in Hungary’s oil and gas firm MOL, CEZ said in a statement on its website.

CEZ, majority owned by the Czech government, owns a 7% stake in MOL. The Hungarian company did not exercise an option to buy back the shares by the Jan 23 deadline.

The bonds will be issued by CEZ’s fully-owned subsidiary CEZ MH B.V., based in the Netherlands, and will be guaranteed by CEZ. The paper has received a preliminary rating of A2 by Moody’s and is expected to be rated A- by Standard & Poor’s, CEZ said. The bonds will have a maturity of 3.5 years and was priced with a coupon of zero.

Bondholders will have the right to exchange the bonds for shares from Jan 25, 2017 to July 21, 2017. CEZ will also have the right to redeem the bonds from February 2017 at their principal amount if the value of the shares exceeds 130 percent of the principal for a specific period. Settlement for the bonds is expected on Feb. 4. 

CEZ bought the MOL stake in 2008 when the Hungarian company was fighting a takeover bid from Austria’s OMV. Then it sold a call option to MOL which had a strike price of HUF 20,000 (EUR 66), which was higher than the company’s market price of HUF 13,955 as of Jan 21, meaning that MOL had no financial incentive to exercise the option.

Related Articles

EU to fund feasibility study on Slovakia’s proposed Eastring gas link to Balkans

The EU has agreed to help fund a feasibility study on the Eastring pipeline project, which would link Slovakia to the Balkan markets, Slovak transmission system operator Eustream announced on May 26. ... more

Hungarian PM's "proxy" moves into the nuclear industry as Paks tenders approach

Firms controlled by Hungarian oligarch Lorinc Meszaros have purchased a 51% stake in the Hungarian subsidiary of Czech nuclear ... more

CEZ set to place Czech nuclear assets in new unit

Czech state-controlled energy group CEZ is set to place all nuclear-related activities into a new division, local media reported on May 17. The move raises speculation that the company is ... more

Register here to continue reading this article and 2 more for free or purchase 12 months full website access including the bne Magazine for just $119/year.

Already a subscriber or registered - click here to recover access.

If you a IntelliNews Pro user - click here to login.

Thank you. Please complete your registration by confirming your email address.
A confirmation email has been sent to the email address you provided.

To continue viewing our content you need to complete the registration process.

Please look for an email that was sent to with the subject line "Confirmation bne IntelliNews access". This email will have instructions on how to complete registration process. Please check in your "Junk" folder in case this communication was misdirected in your email system.

Already a subscriber or registered - click here to recover access.

If you a IntelliNews Pro user - click here to login.

If you have any questions please contact us at sales@intellinews.com

Subscribe to bne IntelliNews website and magazine

Subscribe to bne IntelliNews website and monthly magazine, the leading source of business, economic and financial news and commentary in emerging markets.

Your subscription includes:
  • Full access to the bne content daily news and features on the website
  • Newsletters direct to your mailbox
  • Print and digital subscription to the monthly bne magazine
  • Digital subscription to the weekly bne newspaper

Already a subscriber or registered - click here to recover access.

If you a IntelliNews Pro user - click here to login.

bne IntelliNews
$119 per year

All prices are in US dollars net of applicable taxes.

If you have any questions please contact us at sales@intellinews.com

Register for free to read bne IntelliNews Magazine. You'll receive a free digital subscription.

Already a subscriber or registered - click here to recover access.

If you a IntelliNews Pro user - click here to login.

Thank you. Please complete your registration by confirming your email address.
A confirmation email has been sent to the email address you provided.

IntelliNews Pro offers daily news updates delivered to your inbox and in-depth data reports.
Get the emerging markets newswire that financial professionals trust.

"No day starts for my team without IntelliNews Pro" — UBS

Thank-you for requesting an IntelliNews Pro trial. Our team will be in contact with you shortly.

Dismiss