CTG’s takeover bid to EDP will taint the Chinese President’s visit

  • ECO News
  • 3 December 2018

There is a lot of uncertainty still, regarding the status of CTG's takeover bid to EDP, and this is certainly an issue which will haunt the Chinese President while he visits Portugal this week.

Xi Jinping’s is visiting Portugal on the 4th and 5th of December, amidst high levels of uncertainty regarding the success of the takeover bid from state-owned China Three Gorges’ to EDP, the largest electricity company in Portugal.

CTG became the largest shareholder of the Portuguese electricity company six years ago, and it is now offering to pay €10bn to assure control over EDP and EDPR (Renewables) so that it blocks other investors at once.

However, before the offer can officially get to the market, CTG has to get the green light from regulators in all markets where EDP is present, namely the United States — which, in the context of a trade war between both countries, makes this specific part quite difficult for the takeover bid to go further –, and Brussels. The negotiations with both of these two sides have already started.

Already after having announced its Public Tender Offer (PTO) to EDP, CTG, who detains 23.27% of the capital stock of EDP, was one of the shareholders which decided to object to the payment of €285m in the CMEC (Maintenance Costs for Contract Balance) case, taking it to the international courts, contesting the alleged overcompensation of the company in their maintenance costs calculations.