Czech energy and media oligarch Daniel Kretinsky's EPH group aims to exercise its option to increase its stake in Slovakia's main power company Slovenske elektrarne (SE) to 66%, EPH said.

The move to buy Italian power company Enel's 33% stake would give EPH effective control of SE, though the government retains a 34% blocking minority stake. It would also mark Enel's exit from Slovakia after almost 20 years, during which it has rowed constantly with the government and struggled to modernise the formerly state-owned utility.

Kretinsky’s spokesperson Daniel Castvaj told the Czech Press Agency (CTK) that Kretinsky’s companies are pursuing a majority in SE, which produces about 70% of all electricity generated in Slovakia.

“According to agreements concluded earlier we can buy another third [of SE], which is now held by Italian Enel, and we intend to do so,” Castvaj was quoted as saying by CTK, while declining to specify the timing or the price due to regulatory constraints.

CTK also wrote that talks between Kretinsky’s EPH, a part of EP Corporate Group (EPCG), and the Italian side are already underway, referring to its sources.

EPH entered SE in 2016 through a 50-50 joint venture named Slovak Power Holding BV with Enel, which took over the Italian group's 66% stake.  EPH agreed to pay euro375mn for the effective 33% stake at the time.

Under an option,  the Slovak government had a pre-emptive right to buy out Enel, though Kretinsky's company was always seen as the most likely buyer. Kretinsky has forged close links with  populist Prime Minister Robert Fico's Smer party, under whose previous governments it reached the SE deal and also took over Eustream in 2013, which runs the Slovak section of the Brotherhood pipeline that brings Russian gas to Europe.

CTK also reported that EPCG is to invest up to €10bn into carbon divestment at its German assets controlled by EP Energy Transition. EPH is criticised by energy and environment analysts in Czechia, Germany and other countries as one of the dirtiest companies in Central Europe.

“Transformation of formerly carbon assets already began, gradually we are turning off carbon blocs and investing into the construction of new renewable and low-emission sources,” Castvaj commented for CTK.

The media division of EPCG and EP-linked Czech Media Invest (CMI) is also in talks – through French publishing Editis controlled by CMI – to take over another French publishing house Delcour.  

EPH's takeover of SE has been protracted because the Slovak power group has struggled to complete the new unit at its Mochovce nuclear power plant. This has been a source of constant rows between the government and Enel, and one of the prompts for the Italian group to enter the deal with EPH in the first place and start its exit from Slovakia, after buying the group through privatisation in 2005. At that time it paid euro839mn for the 66% stake.

SE completed the final test runs of the third nuclear block at the Mochovce power plant last autumn and is in the process of turning the fourth block operational this year, though this month Slovak media reported further delays in the process.

In July SE agreed with French Framatome on nuclear fuel supplies for its VVER 440 reactors. Following the Russian invasion of Ukraine SE has pushed to diversify from dependency on nuclear fuel supplies from the Russian state agency Rosatom. The nuclear industry in then Czechoslovakia was launched in close cooperation with the Soviet Union in the 1970s and 1980s. The first supplies from Framatome are expected in 2027.        

Anti-corruption NGOs and liberal media accuse Fico’s government of pursuing the interests of major private corporations at the expense of the country’s economy and rule of law standards. In July, Fico and other cabinet ministers sided with the interests of the  Slovnaft refinery, owned by Hungary's MOL, after it experienced a decreased flow of Russian oil following the Ukrainian tightening of sanctions against Russian giant Lukoil.

Boosted by its energy holdings, Kretinsky and his long-time business partner Patrik Tkac have launched an extraordinary shopping spree in the past two years. As bne Intellienews reported, earlier this month the UK authorities announced a security review of Kretinsky's bid to take over Royal Mail, including Kretinsky’s potential links to Russia.   Kretinsky is also pursuing further investments in the energy market in Germany and the media market in France.

J&T Energy Holding of Slovak billionaire Patrik Tkac's J&T group is a 44.1% shareholder in EPH, 50% plus one share is owned by Czech billionaire Kretinsky, and 6% is owned by its management.