French State EDF Sells Polish Assets

French generator EDF has sold its Polish electricity generation business to Polska Grupa Energetyczna (PGE), it said May 22. The deal values the subsidiary at PLN 6.1bn gross ($1.63bn, €1.46bn), or PLN 4.9bn after deduction of minority interests.

Mostly state-owned EDF is deeply in debt at home and its programme CAP2030 includes asset sales to raise in excess of €10bn in the period 2015-2020. The deal “marks a significant new phase in the plan to sell assets” and will reduce the group’s carbon footprint by about 23%, it said.

The deal needs approval and regulatory authorisation notably from Poland’s anti-trust commission and government and the waiver of pre-emption rights and is expected during the second half of this year.

PGE said its acquisition would increase its generation capacity from 12.75 GWe to almost 15.95 GWe, and more than double its heat generation capacity to 7.57 GWth; the company is 57.39%-owned by Poland's state treasury.

(Credit: EDF)

EDF is present in Poland through subsdiaries EDF Energies Nouvelles and DK Energy Polska, and intends to remain a partner of the Polish government, especially with regards to its nuclear programme, it said.

According to Polish agency Warsaw Voice, other companies bidding were Energa, Enea and heat and power producer PGNiG Termika. The EDF subsidiary produced 8.5% of the country's demand, making it a strategic entity whose sale may be blocked by the government unless it receives satisfactory assurances on the new owner's plans for running the business.

Its assets include the Rybnik power plant, combined heat and power plants in Krakow, Gdansk and Gdynia, heat distribution networks in Torun, the Wroclaw agglomeration and Zielona Gora as well as a gas-fuelled block project in Torun.

William Powell