EDF close to completing $4.5bn deal in US
November 2009
EDF is understood to be completing a $4.5bn deal with Constellation Energy of the US any day now which could prevent any attempt by the French nuclear group’s incoming leadership to pull out of the American market.
In a statement on Monday November 2nd EDF said it planned to sign the final contract as soon as possible to acquire a 49.99 per cent stake in the existing nuclear assets of its US partner after receiving the final necessary approvals from Maryland state regulators on Friday.
Pierre Gadonneix, the outgoing chief executive who has made expansion in the US a key plank of his international strategy commented that it was “eager to enhance its presence in … the largest market in the world”.
The company’s soon to be in place Executive Chairman Henri Proglio, has said in recent weeks that he has doubts about the US strategy. Proglio was reported to have restated these doubts in private testimony to parliamentary deputies last week. French government officials have also expressed doubts about the need for EDF to invest in the US market.
EDF has recently faced pressure over its foreign expansion at home given the need to invest heavily in improving the capacity of its French reactors as the country prepares to import costly energy for the second winter in a row.
Nonetheless, the unexpected approval from Maryland’s public authorities on Friday night – with only minor concessions demanded for consumers – has given Mr Gadonneix’s strategy a boost just weeks before he will have to step down after a five-year term.
The company said on Monday that it would not call a special board to approve the deal as EDF directors, who include Mr Proglio, had already voted in favour last December.
Michelle Williams from Artemis Solutions Group who specialise in the energy sector comments “It looks likely that the deal will go ahead and if it does, EDF will have a near-50 per cent stake in five existing reactors on the east coast of the US.”
