Czech billionaire Kretinsky's EPH joins suitors for Uniper, sources say

By Christoph Steitz, Emma-Victoria Farr and Jan Lopatka

FRANKFURT/PRAGUE (Reuters) -Czech billionaire Daniel Kretinsky is among potential suitors approached by Berlin about buying German state-owned utility Uniper, three people familiar with the matter said.

Sources have said previously that others approached include New York-headquartered fund Brookfield, Norway's Equinor and Abu Dhabi's TAQA.

Czech energy holding company EPH, which is majority-owned by Kretinsky's investment vehicle EPCG, is "part of the process", one of the sources said, declining to be identified because the talks are confidential.

EPH and Uniper declined to comment.

A spokesperson for Germany's Finance Ministry, which oversees the government's Uniper stake, said only that Berlin was examining all scenarios to cut its stake, and that no decision on timing and the structure of any deal had been taken.

Berlin is looking at divesting its 99.12% stake in Uniper, which had to be nationalised during Europe's energy crisis in 2022, with options ranging from a partial to a full sale of its holding, sources have said.

Uniper is currently valued at 19 billion euros ($19.6 billion), meaning a stake sale could rank among Europe's biggest deals in 2025, even though sources have said a sale would likely involve a discount.

It would also be the biggest target Kretinsky has taken on so far, though it is possible EPH could team up with a partner.

ANTITRUST SCRUTINY

EPH purchased some Uniper assets in France in 2019 and is no stranger to Germany's energy sector, having bought Vattenfall's local lignite-fired power stations in 2016.

In Germany, investment firms controlled by Kretinsky also own a fifth of Thyssenkrupp's steel unit and 45.62% of wholesaler Metro.

The government has spent 13.5 billion euros on bailing out Uniper in one of Germany's biggest corporate rescues.

Any deal involving Uniper as critical infrastructure will face comprehensive regulatory scrutiny, two of the people said. Berlin can critically review, and even block, any attempts by non-EU suitors to buy more than 10% in German power assets.

Uniper supplied around a quarter of the gas used in Germany last year and is its largest gas storage operator. It also operates nearly a quarter of the country's so-called systemically relevant power capacity which must be kept on reserve to ensure supply.

Under the bail-out deal with the European Commission, Berlin must cut its stake in Uniper to at least 25% plus one share by 2028. Uniper, meantime, must sell a number of assets, including its Datteln coal-fired power plant, by end-2026.

Of the 10 asset disposals requested by Brussels in December 2022, Uniper has so far completed seven.

($1 = 0.9699 euros)

(Reporting by Christoph Steitz, Emma-Victoria Farr and Jan Lopatka. Additional reporting by Andres Gonzalez and Christian Kraemer. Editing by Jason Neely and Mark Potter)