Czech PM Babis: I'm Shocked by What is Happening in Bulgaria

Politics | February 27, 2018, Tuesday // 21:48|  views

Czech Prime Minister Andrej Babis today strongly criticized the sale of CEZ's business in Bulgaria.

The leadership of the energy company must explain to the Supervisory Board the sale of Bulgarian assets to Inercom, the Czech Prime Minister, who has resigned since January 17, after failing to get a vote of confidence from parliament, told Lidove News .

Babis added that CEZ's leadership, in which the Czech state has 70% majority shareholding, has been criticized for its actions in the Balkans since the company's latest operations. According to the prime minister, the energy company's deals were unfavorable, opaque and just strange.

"I am shocked by what is happening in Bulgaria. In addition, Prime Minister Boyko Borisov said that the whole thing is being investigated by different authorities. I do not understand the current situation at all. CEZ CEO Daniel Benes has to explain to the Supervisory Board what's going on, "said Babis.

Today, the Czech prime minister held a telephone conversation with Bulgarian counterpart Boyko Borisov on the sale of Bulgarian assets of CEZ. According to the press center of the Bulgarian government, Borisov has indicated that they are part of Bulgaria's national security system. He has asked the competent Bulgarian authorities for information to be provided by the Czech government on the deal. Babis has assured him that he is informed by the Supervisory Board of the company that the sale is completely legal and does not pose a risk to any of the parties.

In front of Lidove novini, the Czech Prime Minister stressed that CEZ is not a fully state-owned company and indicated that the management of the company in the past repeatedly did not comply with the position of the authorities in the Czech Republic. Babis added that Benes had assured him that the deal was completely transparent.

"CEZ did not respect us, more or less this company does what it wants. CEZ is a state in the state, "the Czech Prime Minister said.

He added that the resignation of Minister of Energy Temenujka Petkova in Bulgaria, instead of calming the situation, has given an alarming signal to the Czech Republic.

Lidove News reports that the Bulgarian Development Bank denies that it has given credit or guarantees to Inercom, and this is stated in the documentation provided to the Supervisory Board of CEZ.

 "If someone has given false data to CEZ's Supervisory Board, that will be a big problem. I am very unpleasantly surprised. CEZ's activities in Bulgaria are not profitable, and the sale of Bulgarian assets has become a bad situation. Let's see how it works, "Babis said.

The CEZ Group signed a contract for the sale of its assets in Bulgaria with "Inercom" last Friday and the deal is subject to approval by the Bulgarian regulatory authorities.

According to Lidove News, CEZ's Supervisory Board data show that two Bulgarian banks - UniCredit Bulbank and First Investment Bank - financed EUR 180 million and EUR 80 million respectively with a total value of EUR 342 million. And the Bulgarian Development Bank has undertaken to refinance already existing EUR 65 million in the European Bank for Reconstruction and Development. Buyer company "Inercom" participates with own funds amounting to 20 million euro. A EUR 100 million comes from a consortium of "Global Victory Trust" registered in Luxembourg.

UniCredit Bulbank refused to comment on BNR information and First Investment Bank denied any participation in the financing of the deal between Inercom and CEZ.

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Tags: CEZ, Babis, comment


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