CEZ - fin. minister reportedly plans to pay high dividend next year

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Investiční bankovnictví KB

      According to daily MF Dnes, Finance Ministr Sobotka informed representatives of government in Supervisory Board of CEZ that it plans to propose to pay high dividends next year to compensate for lack of privatization revenues of budget. Higher dividends should also pay the other companies under government control. Moreover, he asked the Supervisory Board to reject the Board of Directors’ bid in privatization of coal-mining companies. Industrial Minister Urban said in an interview with daily Hospodarske Noviny that one of the possibilities to solve the current rows between the Supervisory Board (government) and Board of Directors are changes in management. CEZ took part in the first round of privatization of coal-mining companies. However, if it passes to the second round it would have to offer a price, for which it needs an approval of the Supervisory Board. CEZ said that it had to take part in the privatization otherwise it could face a lawsuit. CEZ bought 38% stake in Severoceske doly for CZK 3.5bn and there is reportedly risk that it would have to revaluate it based on the winning offer, which could reportedly lead to one-off charge of up to CZK 1bn. Minority shareholder of CEZ also reportedly threatened with a lawsuit.

       Situation around CEZ is hard to read. While the company’s management argue with valid legislation, the government is strongly against privatization of coal-mining companies by CEZ. We expect the market to react negatively to any management changes, which successfully restructured the company.

      Tyto zprávy pro vás vytváří Investiční bankovnictví KB.