PARIS, July 6 (Reuters) – The French government plans to fully nationalize EDF ( EDF.PA ), Prime Minister Elisabeth Borne announced on Wednesday, sending shares in the debt-ridden power company soaring.
“I confirm to you today that the state intends to control 100% of the capital of EDF,” Bourne said in his policy speech in the lower house of parliament as he set out his minority government’s priorities. Read more
EDF, already 84% owned by the state, faces delays and budget overruns for new nuclear plants in France and Britain, as well as corrosion problems in some of its aging reactors.
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Half of its reactors in France are currently offline.
EDF has also suffered from government rules forcing it to sell power to rivals at a discount while prices hit record highs.
The company has estimated that production losses will reduce profits by 18.5 billion euros, and reduced electricity sales will cost it 10.2 billion euros. Its debt is expected to rise by 40% this year to more than 61 billion euros.
The option to fully nationalize EDF was mooted by President Emmanuel Macron earlier this year as he intends to make the company a key pillar of a massive investment in new nuclear reactors.
Borne did not specify whether the nationalization would be done through special legislation or through a buyout of minority shareholders, nor did he give a time frame.
Shares in the group, which fell 5% before the announcement, rose as much as 9% immediately after it.
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Reporting by Michelle Rose and Tassilo Hummel; writing by Silvia Aloisi; editing by Jason Neely
Our standards: The Thomson Reuters Trust Principles.
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