One of Europe’s largest energy players is set to be partially privatised following an announcement from the French government regarding Electricité de France (EdF).
Some 15% of the state-owned energy giant, is expected to be floated on the French stock exchange by 21 November, although the government will retain an 85% holding.
The move still commits EdF to lowering some prices, but also to improving rural service levels, as well as investing around €40 billion over the next five years.
Trade unions and the Socialist Party (PS) opposition have condemned the move, branding it a huge and costly mistake.
Despite the criticisms, shares in EdF have been priced higher than expected with a range that could value the group at up to €63 billion.
The shares will be on sale to institutional investors for €29.50 to €34.10 each, the French finance ministry has said. The valuation is set to make EdF Europe’s largest publicly traded utility.
Retail buyers will be offered EdF shares at a discount of €1 in the offer which runs from 28 October 28 to 17 November.
Credit Agricole’s Calyon investment banking unit, Morgan Stanley, BNP Paribas and ABN Amro Rothschild are managing the sale.
Meanwhile, the French government has suspended plans for the partial privatisation of its nuclear energineering and technology company Areva. Originally mooted as a precursor sale to the EdF sell off, the move may now be seen as an attempt to smooth the path of other privatisation deals in the offing.
Prime Minister Dominique de Villepin has cited safety concerns as a prime reason for the policy change that would have seen the company listed next year. The part-privatisation had been expected to raise as much as €5.6 billion from a 40% stake sale