Polish state company consortium reportedly closing in on EDF's "strategic" Polish assets

By bne IntelliNews September 16, 2016

Four state-controlled energy companies and a state-owned investment fund are reportedly working on a joint bid to buy the Polish power assets of French company EDF, local media claimed on September 16.

Utilities PGE, Energa, Enea, and PGNiG Termika are reported by unnamed sources to have teamed up with the Polish Development Fund (PFR) to push the deal. Warsaw recently secured control over the deal by declaring the assets strategic.

A bid from the quintet could be ready this month, Puls Biznesu reports. Should it materialise, the consortium may find itself competing with Australian investment fund IFM, which reportedly filed an offer in early August. It was speculated earlier this year that Poland was pushing EDF to delay the sale until state-controlled companies were able to step into the process. Finnish utility Fortum and Czech energy groups CEZ and EPH expressed interest in the EDF portfolio - which features several coal-fired heat and power assets - earlier this year.

The Law and Justice (PiS) government has made it clear on several occasions it wants to boost the role of the state in economy. Increasing control in the energy sector is a vital part of that strategy. Polish utilities have already been pushed this year to put around PLN1.5bn (€350mn) into saving Poland’s largest miner Kompania Weglowa and may still chip in more capital to save its peer KHW.

EDF is looking to offload its coal-fired heat and power assets in line with a strategy to switch to less emission-intensive installations. Poland has said repeatedly coal will remain its staple fuel. In connection with the coal rescue and Warsaw’s drive to increase state control over the energy sector, EDF’s portfolio would clearly be a tempting target for state-controlled power firms.

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