Tuesday, June 8, the State regains control of the energy company following its renationalization
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This is the last episode of a soap opera whose beginning dates back to July last year with the announcement of the operation by the Prime Minister, Elisabeth Borne. The state, which owns 84% of EDF’s capital, wanted to regain full control in order to revive nuclear power more quickly. The last phase therefore takes place on Thursday, June 8 at the end of a public takeover bid (OPA) on the last EDF shares remaining listed on the stock market, but also after many twists and turns and appeals from small shareholders who consider themselves robbed, finally dismissed by the courts, the Paris Court of Appeal in this case.
A 17-year stock market adventure
The opening of EDF’s capital and its entry into the market took place in 2005. Share repurchase price today: 12 euros, whereas five million French people had paid 32 euros at the time of the semi- privatization. In total, the state is spending 9.7 billion euros to regain control of the group.
This renationalisation of EDF has more than symbolic significance for the State shareholder, which plans to build six new-generation EPR nuclear reactors and relaunch the sector. Far from being symbolic also for this company which posted a loss close to 18 billion euros last year and which is indebted today to the tune of 64 billion. The political power and the new boss of EDF, Luc Rémont – successor to Jean-Bernard Lévy – will now negotiate with Brussels the methods of financing the new reactors.
The context remains difficult in Europe
This will be done against the background of major differences between Member States of the Union on the future of nuclear power. Struggle especially with Germany. And then, internally, Luc Rémont will have to find common ground with his new 100% shareholder (the State) on the supervision of electricity prices. The mechanism in force until the end of 2025, called Regulated access to historical nuclear electricity (Arhen), obliges EDF to sell electricity at low prices to its competitors, alternative suppliers, to limit household bills. A system objectively disabling for the group.
The device, very political for the State vis-à-vis French households, is not tenable for an over-indebted company, but how to envisage the continuation? The CEO Luc Rémont must now present his roadmap at the end, there too, of a very probable standoff between the CEO and his new supervision.