Enel has reached a "general" agreement to sell part of its 66% stake in Slovakia’s dominant power producer Slovenske Elektrarne (SE) to Czech-based energy holding Energeticky a Prumyslovy Holding (EPH), unnamed sources at Enel were reported to have said on October 22.
Enel started exclusive negotiations with EPH in August. The source claims that although Enel and EPH have reached an agreement, they still need a month to work on the details, according to Reuters.
The exclusive talks were meant to be wrapped up on October 16, the newswire claims. The Italian company has been trying to divest its Slovak assets for more than a year, but said in the summer that it will now sell in two tranches. It has suggested since that the first tranche would likely involve a stake of around 30%.
EPH spokesman Daniel Castvaj refused to comment on the reported agreement to bne IntelliNews, saying he can only confirm the holding is in exclusive talks with Enel. He also refrained from discussing the size of stake under discussion, the claims that the talks have been delayed, or when EPH expects to seal a deal.
EPH’s entrance into SE will clearly be welcomed by Bratislava, the holder of the remaining 34% stake. The Slovak government's insistance that it intends to take control of the company has put off most other bidders.
Enel also received an offer from a Hungarian consortium of Slovak refining and fuels group Slovnaft - owned by Hungary's group Mol - and Hungarian state power holding MVM. However, the consortium recently announced it is dropping the bid.
The owners of EPH – from Slovak financial group J&T – are reportedly on good terms with Prime Minister Robert Fico, and has proven it can work happily with his government. The Czech-based holding bought EDF Suez and E.ON out of their 49% stake in Slovak gas utility and pipeline operator SPP in 2013. The state holds the majority 51% stake, but EPH maintains operational control.
Economy Minister Vazil Hudak said on October 21 that Slovakia could seek to gain control in SE via other means than buying a larger stake from Enel. While Bratislava is still looking at increasing its shareholding, he said, it could also look at the option of changing the shareholder agreement. The government has hired KPMG and SPP to advise it on a potential acquisition.