Energo-Pro mulls EUR 350m loan guarantee for the CEZ bid



Bulgarian energy distribution company Energo-Pro mulls a EUR 350m loan guarantee for its majority owner who is bidding for CEZ’ Bulgarian assets, according to a filing by Energo-Pro Bulgaria.

Ensuring the new bid for CEZ

The latter is asking bondholders to approve a EUR 350m loan guarantee for its owner Energo-Pro a.s. who is also among the bidders in the ongoing sale of the CEZ’ Bulgarian assets – distribution company CEZ Distribution Bulgaria (3MZ BU), trading subsidiary CEZ Electro Bulgaria (1CZ BU), and other assets. Energo Pro wants its bondholders approval on the guarantee provided that they also approve an earlier call option of its outstanding 7-year EUR 130m corporate bond at 101.5% up to December 31st, 2017. The bondholders’ meeting is scheduled for Oct. 12th, 2017.

Bid process

CEZ Group has initiated a sale process of its local assets at the start of 2017 and received a couple of bids. Yet, recent media publications revealed the seller was not satisfied with provided bids and is negotiation bidders to up them.

According to media reports the minimum threshold for the assets was c. EUR 300m. In the meantime latest government reshuffle in the Czech Republic is also expected to affect the process.

CEZ may sell Varna power plant separately from other Bulgarian assets

CEZ may sell a power plant in Bulgaria’s Varna separately from its other assets in the country, CEZ Supervisory Board Chairman Vaclav Paces was quoted as saying by the Czech financial newspaper Hospodarske Noviny, which was quoted then by Reuters.

“We gave an approval for negotiations on this. The original plan was to sell all assets together, but that has changed because the bid for Varna was so attractive that most probably, it will be sold separately,” Paces told the paper.

The Company got an offer worth around 50 million euros, the paper said without further details on sources.

Check the latest equity research reports by ELANA Trading