April 1 (SeeNews) - Financial and insurance group Eurohold Bulgaria [BUL:4EH] said on Monday that it has submitted a binding offer for the assets of Czech energy group CEZ in Bulgaria.
Eurohold Bulgaria will participate in the procedure for acquiring the assets on its own, and will use own funds, with additional support to be provided by leading Western European banks, the Bulgarian holding company said in a statement.
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Eurohold's intention to acquire the Czech energy group's assets in Bulgaria is part of its long term strategy to enter new business segments with high growth potential, it explained.
In parallel, Eurohold is looking into the possibility to divest part of non-insurance assets in order to focus on segments with the highest growth potential, the holding company announced.
The assets of CEZ in Bulgaria comprise power utility CEZ Distribution Bulgaria [BUL:3CZ], power supplier CEZ Electro Bulgaria [BUL:1CZ], licensed electricity trader CEZ Trade Bulgaria, IT services company CEZ ICT Bulgaria, solar park Free Energy Project Oreshetz, biomass-fired power plant Bara Group and CEZ Bulgaria.
Eurohold Bulgaria's shares closed 1.04% lower at 1.9 levs on the Bulgarian Stock Exchange, while CEZ Distribution Bulgaria [BUL:3CZ] shares added 0.92% to 220 levs. The other BSE-listed CEZ unit - CEZ Electro Bulgaria [BUL:1CZ], did not trade on Monday.
Last month, Eurohold Bulgaria said that it is planning to seek to raise up to 154.1 million levs ($89.5 million/78.8 million euro) in a capital increase through the issuance of up to 79,010,240 preferred shares. Eurohold Bulgaria shareholders will vote on the proposed capital increase at a meeting scheduled for April 22.
Also last month, CEZ told SeeNews that it has a new prospective buyer for its assets in Bulgaria, which had not submitted a binding bid in the initial call for offers in 2017. CEZ will determine its future course of action regarding the sale of its assets in Bulgaria in April, CEZ press officer Alice Horakova said at the time without naming the potential buyer.
CEZ Group launched the procedure for selling its assets in Bulgaria in 2017 and said it received several binding offers under its initial call. The company signed an agreement to sell the assets to Sofia-based Inercom in February 2018 but the deal was later rejected by Bulgaria's Commission for Protection of Competition. Both CEZ and Inercom are currently appealing the regulator's decision before court.
The price of the transaction was estimated at 326 million euro ($378.3 million) in CEZ Group's annual financial statement for 2017.
In December 2018, CEZ announced that it plans to start parallel negotiations with India Power over the sale of its Bulgarian assets, but the deal with Inercom remains valid.
($ = 0.8813 euro)