EDF slides as energy minister hints at EDF-Areva merger
Reuters
Published Mar 09, 2015 09:58
EDF slides as energy minister hints at EDF-Areva merger
PARIS (Reuters) - Shares in French state-controlled utility EDF fell as much as 4.4 percent (PA:EDF) in early trade after Energy Minister Segolene Royal said on Monday all options were on the table regarding a link-up between EDF and nuclear group Areva (PA:AREVA), including an outright merger.
Asked on news channel BFMTV specifically whether a merger was one of those options, Royal replied: "Perhaps. All options are on the table. All scenarios are being looked at in terms of the national interest. The national interest is to create champions in the energy sector."
EDF shares have lost more than 9 percent, or more than 5 billion euros (3.6 billion pounds) in value, since Economy Minister Emmanuel Macron said last Wednesday that industrial cooperation between EDF and loss-making Areva could go as far as an alliance, including in terms of capital.
Areva, which like EDF is more than 80 percent owned by the French state, last week reported a record 4.8 billion euro loss in 2014, its fourth consecutive annual loss, as new management booked heavy provisons and writedowns.
EDF chief executive Jean-Bernard Levy said last month there was no question of EDF making a financial investment in Areva.
At its 2014 earnings presentation on Wednesday, Areva talked about "reforging the partnership with EDF".
It also said in its statement that it had plans for "partnerships with an equity component" and was "studying means for strengthening its equity". It gave no further details but promised more clarity later this year.
EDF investors fear that Areva's troubles will drag down the utility, which already struggles under heavy debt and slack power demand.
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Written By: Reuters
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