Following a change in management at CEZ, the Czech electricity utility, the company has increased its holding in the Skoda Praha engineering group from 11 per cent to 27.89 per cent, Reuters reports.
The move is significant given the concerns raised over potential conflicts of interest after a senior member of Skoda Praha’s management was appointed to the board of CEZ. Skoda Praha is one of the main contractors to CEZ for the troubled Temilin nuclear power station, which is running significantly over budget and behind schedule.
The business analysts Salomon Smith Barney described the move as a “Marriage of convenience with no evident synergies…. We see no real benefits in the deal for either the government or the shareholders.”