UPDATE:France Hasn't Decided Against EDF/Constellation-Sources
31 10월 2009 - 12:04AM
Dow Jones News
The French government hasn't decided whether state-controlled
power company Electricite de France (EDF.FR) should walk away from
its delayed $4.5 billion plan to buy half of U.S.-based
Constellation Energy Group Inc.'s (CEG) nuclear business,
government officials told Dow Jones Newswires Friday.
The government-designated incoming chairman and chief executive
of EDF, Henri Proglio, told lawmakers this week he had doubts about
whether the investment in Constellation is in the company's best
interests.
However, the government officials said there has been no formal
review of EDF's U.S. plans.
"There has been no decision made yet, and so far, the government
has no position for now," said a senior government official on
condition of anonymity.
"To my knowledge, (EDF's) strategy in the U.S. isn't being
called into question," another government source said.
The Financial Times reported earlier Friday that EDF is facing
pressure from the French government to abandon its current plan
with Constellation, citing a senior civil servant.
The French state owns 85% of EDF.
"This is an industrial case and this can be decided by an EDF
board meeting only," the senior government official told Dow
Jones.
EDF has stretched its balance sheet in the past 18 months on a
buying spree that helped double the company's net debt to EUR36.79
billion by June 30 from the same time a year earlier. Besides
Constellation, EDF has acquired the big U.K. nuclear group British
Energy.
"For us, the priority strategy for EDF is indeed in Europe,
notably the U.K. and Italy, and everything outside Europe is less
essential to EDF's expansion," the senior government official
said.
However, the second government source emphasized that outgoing
EDF CEO Pierre Gadonneix's plan to invest in Constellation's
nuclear business and then build new plants in the U.S. could bear
fruit.
"We'll see in some years, but essentially it's a strategy that
we validated and which seems pertinent," the person said.
"If EDF gets to build its power stations [in the U.S.], it's an
affair that can certainly be profitable for EDF and for the nuclear
industry," the person said.
EDF is the world's largest operator of nuclear power plants,
with 58 reactors in France.
The company agreed in December to buy 49.99% of Constellation's
nuclear assets and build four nuclear reactors with the U.S.
company. The deal has been delayed due to regulatory issues.
"The process is in progress," an EDF spokeswoman said Friday,
adding that the company is waiting for a decision from regulators
in the U.S. state of Maryland, where Constellation is based.
Maryland regulators confirmed Friday that the decision on
Constellation would be received later in the day.
Constellation said Friday that it remained committed to the
nuclear sale to EDF and that the deal could close in the next two
weeks.
"Henri Proglio hasn't yet spoken in public about the industrial
strategy he intends to conduct," the EDF spokeswoman said.
The second government official had no knowledge of any official
study on whether EDF should focus on Europe, the person said.
If Henri Proglio were to propose a change of strategy, the
government would listen and weigh up the reasons and the
consequences, the person said.
-By Adam Mitchell and Geraldine Amiel, Dow Jones Newswires; +33
1 40171740; geraldine.amiel@dowjones.com;