French privatisation plans for EdF and Areva

9 February 2005

Finance Minister Herve Gaymard has outlined a time scale for the forthcoming privatisation of parts of the French state-owned energy sector, including stakes in Electricite de France (EdF) and Areva that are due to be divested by the end of the summer and the end of the year respectively.

The government hopes to raise some euro 8 - 11 billion from the partial privatisation of up to 30% of EdF and a further euro 10 billion for up to 40% in Areva. However, the privatisation faces considerable labour opposition and there are significant EdF liabilities that may take the wind out of any privatisation’s sails. For example, EdF is currently embroiled in an on-going dispute with the Italian government concerning its assets in Italy. The French government has reportedly suggested that any move by Italy’s Enel to acquire a stake in EdF as part of the forthcoming privatisation would be welcomed as a way to resolve the dispute.

In a separate move, the Olkiluoto 3 consortium comprising Areva and Siemens has taken over the construction site for the new PWR power plant to be built in Olkiluoto, Finland from Finnish utility TVO. Framatome ANP, an Areva and Siemens company, will supply the nuclear island and Siemens Power Generation the turbine island.

The district of Eurajoki issued the construction permit for the Olkiluoto 3 plant in mid-January and a nuclear construction license is expected from the Finnish government in the 1st quarter of this year.


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