Germany-based Uniper SE entered into exclusive negotiations with Czech Republic energy group Energeticky a Prumyslovy Holding a.s., or EPH, to divest ownership in all of its French assets.
Through its wholly owned subsidiary EP Power Europe a.s., EPH filed a unilateral binding offer to Uniper to purchase all of the German company's activities and business in France.
Uniper's French assets include two gas-fired facilities with a combined capacity of approximately 800 MW, two coal-fired plants with an installed capacity of roughly 1,200 MW, a 150-MW biomass plant and 100 MW of wind and solar resources.
The fate of the coal facilities depends on the French government's decision to phase out fossil fuel generation by 2022 as part of the country's plan to reduce carbon emissions. Uniper's France business is "largely organized around these assets," EPH said in a news release Dec. 24. Due to the pending coal plant shutdown, Uniper had mandated investment bank Rothschild to explore a sale for its French business, Reuters reported in September, citing a person with direct knowledge of the matter.
Among other factors that resulted in Uniper's review of its business in France, that division provides a low-single-digit million euro contribution to the overall 2017 group net income, Uniper said in a separate news release Dec. 24.
The next stage for the companies is to initiate a mandatory consultation process with the employees' representative bodies in January 2019 to be able to close the acquisition. The financial terms were not disclosed.
Additionally, EPH has signed an agreement with French energy giant TOTAL SA to transfer Uniper's two gas-fired plants after the closure of the transaction. EPH Board Vice Chairman Jan Špringl said in the news release, adding, "The economics of two gas fired power plants would be negatively impacted by the coal fired plants' closure."
Headquartered in Düsseldorf, Germany, Uniper supplies electricity and gas products to industrial and commercial customers in more than 40 countries. Uniper's largest investor, Finland-based Fortum, owns 47% of the company's stake. Fortum Oyj had sought a full takeover of the German utility but Uniper's management declined the offer.
EPH is headquartered in Prague and has operations, including power generation and natural gas transmission, in seven European countries.