Almost 10 billion euros to nationalize EDF. The French state passes from words to deeds and announces a takeover bid (OPA) for 100% of the energy giant. They are on the plate 9,7 billion euros total, equal to 12 euros per share.
The details of the French takeover bid on Edf
The offer price represents a premium of 53% compared to Edf's quotations recorded on 5 July last, the day before the President announced his intention to nationalize the company, by 46% compared to the average market price weighted by volumes over the last 60 days and by 34% compared to the price of previous twelve months. It is no coincidence that the shares, which were suspended from trading last week, are today earn more than 15% of their value, reaching 11,79 euros, just below the takeover bid price.
Going into the details of the offer, the French State, which already holds 84% of Edf, will acquire 15,9% of the share capital of Edf and 60% of the bonds convertible and/or exchangeable for new or existing shares which it does not hold, by way of a simplified takeover bid which will be filed with the Autorité des Marchés Financiers (AMF) subject to the promulgation of a amending financial law for 2022 (currently under consideration by the National Assembly) which provides for the budget allocations necessary for the offer.
“This operation implements the general address speech by the President of the Council given to Parliament – he commented Bruno Le Maire, Minister of Economy and Finance – Strengthen France's energy independence. It gives EDF the necessary means to speed up the implementation of the new nuclear program desired by the President of the Republic and the deployment of renewable energies in France. EDF can count on the full support of the State for this industrial project of unprecedented scale for 40 years".
The reasons for the nationalization of Edf
“Nationalization is the only way to save the company is ensure the generation of electricity,” said Ingo Speich, head of sustainability at Deka Investment, a shareholder of EDF. “It is a bitter but necessary pill”.
Over the last few months, Edf has had to face several unplanned outages of its battery of nuclear reactors, delays, rising costs in the construction of new reactors and tariff caps imposed by the government to protect French consumers from the increase in electricity prices, underlined Reuters. All difficulties amplified by the explosion of the war in Ukraine which made state intervention in energy all the more necessary in order to ensure supplies.
With the state as the sole shareholder, EDF could carry out several decisive projects announced by the President of the Republic in his speech in Belfort, in particular the construction of six EPR 2 technology reactors by 2050. These projects will keep the company busy for decades to come, during which the giant will continue to play a key role in France's energy supply.
