EPH Seals Deal to Buy Uniper’s French Assets
Czech-based energy holding EPH agreed July 4 a deal to buy generating assets in France from Germany’s Uniper. The deal comes around six months after EPH subsidiary EP Power Europe made an offer for Uniper’s French business. Negotiations are now complete and all regulatory approvals have been received.
The purchase extends a long series of acquisitions in recent years by the closely-held EPH, which is also the joint-owner and operator of Slovakia’s mainline gas pipeline carrying Russian gas to Europe. Controlled by the influential businessman Daniel Kretinsky, the company has bought up ageing generation assets – largely coal-fired – in central Europe, the UK, Italy and Germany as traditional utilities have changed strategy to target renewables.
The transfer of Uniper activities in France to EPH is “to be completed shortly,” the buyer said in a statement. The value of the deal was not detailed. The German utility had announced a strategic review of its French business in late summer 2018.
The assets EPH will buy include two gas-fired power plants in Saint-Avold (Lorraine), two coal-fired power plants in Saint-Avold and Gardanne (Provence), a biomass power plant "Provence 4 Biomasse" in Gardanne, and wind and solar power plants.
EPH’s gamble is to buy the assets cheaply in the hope of benefiting from capacity market mechanisms: state payments for keeping capacity mothballed as a back up to renewables during the energy transition. The sources of funding for the ongoing acquisition drive and the company's levels of debt have long been a source of interest in the Czech Republic.
“The decision by the French government to close our two coal-fired power plants long before the end of their technical operating lives would have affected our entire business,” said Uniper COO Eckhardt Rummler. “We therefore had to act entrepreneurially.”
“We are proud to enter the French energy market which plays a key role in Europe,“ said EPH vice-chairman Jan Springl. “The acquisition of Uniper France perfectly fits to the strategy of EP Power Europe to further expand its presence in the European power generation sector.
“The portfolio of Uniper France is well diversified,” he continued. “Apart from conventional generation we are happy to expand our presence in generation from wind and solar. Additionally the biomass plant in Provence further strengthens our position in biomass based generation and ideally complements our portfolio located in the UK and Italy. We enter the French market with a strategic intention to further develop the business of Uniper France,” he added.
EPH's entry to the French market comes as Kretinsky is pushing to buy control of major media outlets in the country. His purchase earlier this year of a stake in the Le Monde, and reports that he hopes to take control of the newspaper of record to add to his other French media assets, has raised concern among journalists.