EDF: the State holds 90% of the capital, a crucial threshold for nationalizing the group

A crucial step has been taken. The State announced Friday evening, through the voice of the Ministry of the Economy, having crossed the threshold of 90% of the capital and voting rights of EDF, a turning point towards the renationalization of the group. The operation, costing 9.7 billion euros, is strategic for the State, which wants to build six new-generation EPR nuclear reactors, with an option for eight others.

“On January 19, 2023, the State crossed the threshold of 90.00% of the capital and the theoretical voting rights of EDF”, indicates a press release, noting that the State will therefore be able in a second stage “to proceed with the implementation of the compulsory withdrawal” of EDF shares from the Paris Stock Exchange.

Delisting delayed by May

From now on, the State will be able, at the end of the offer, to force the remaining minority shareholders to sell their shares, because they now represent less than 10% of the capital and voting rights.

However, the renationalization, decided last summer by the State, which already owns 84% ​​of EDF’s capital, has not yet been completed. The takeover offer, which opened on November 24, was initially scheduled to close on December 22. But the AMF decided on December 7 to postpone this deadline indefinitely “pending the decision of the Paris Court of Appeal on the request for a stay” filed by a group of minority shareholders who judged the proposed price of 12 euros per share insufficient.

The hearing to consider this stay is scheduled for January 25. Another hearing is then scheduled on the merits, on March 23.

The Paris Court of Appeal has a maximum period of five months – from the date of filing of the appeal – to rule on the merits. What further delayed the rise of the State to 100% of the capital of EDF?

Initially announced for the fall, then for the end of 2022, the operation is now scheduled “no later than May 2023”. “The finalization of the operation by way of compulsory withdrawal can only be carried out once a decision favorable to the State has been rendered”, indicates a source within the public authorities.

An alternative bill

For investors, the consequences are limited because they can now choose to sell their shares to the State on the market, instead of bringing them to the takeover bid. For the government, on the other hand, this new delay increases the political risks on the operation and delays the horizon of EDF’s restructuring.

In December, the socialist deputy Philippe Brun tabled a bill to initiate “a real nationalization” of the EDF group, “in contrast to this takeover bid which only aims to remove the group from the stock market to reorganize better and dismantle it”, says the MP. This must be examined in the National Assembly on February 9.

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