France's Hollande Backs EDF's UK Nuclear Project
May 17 2016 - 5:47AM
Dow Jones News
By Inti Landauro
PARIS--French President Francois Hollande on Tuesday said he
backed state-controlled Electricite de France SA's (EDF.FR) plan to
build two nuclear power plants at Hinkley Point in southwestern
England.
"I am in favor of this work being carried out," Mr. Hollande
said in an interview with French radio station Europe1. He added a
definite decision on the project's go-ahead would be made in the
coming weeks.
The 18 billion-pound ($25.9 billion) project has been questioned
by company officials and labor unions who consider it would
threaten debt-laden EDF's financial stability.
The company's Chief Financial Officer Thomas Piquemal quit on
disagreements over Hinkley Point two months ago, sparking a debate
on the risks associated with the construction of two nuclear plants
for a company already loaded with EUR37.4 billion net debt.
Mr. Hollande's comments underline the French government's
position that the project is necessary for EDF to maintain its
global position in the nuclear power industry.
EDF's Chief Executive Jean-Bernard Levy said the company would
make a final decision on Hinkley Point after the board members and
the company's unions separately approve the project.
The project is the centerpiece of a series of business deals
between the U.K. and China announced last year, with China General
Nuclear Power Corp. agreeing to take a 33.5% holding in the
development.
In order to go ahead with the project, EDF has said it will
raise EUR4 billion in a capital increase. The government, which
owns about 85% in EDF, will also contribute with EUR3 billion.
The company also plans to sell assets worth EUR10 billion and
cut dividends.
Write to Inti Landauro at inti.landauro@wsj.com
(END) Dow Jones Newswires
May 17, 2016 05:32 ET (09:32 GMT)
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