ČEZ transformation involves major privatization of profitable assets

The government of Andrej Babiš is planning a major transformation of the ČEZ group, a move described as one of the largest privatizations of state assets since the 1990s. While framed by some as a nationalization, the plan involves splitting the group into two distinct parts.

The state would retain the high-risk, loss-making production side, which includes nuclear power plant construction and the transition away from coal. Conversely, the profitable distribution and customer-facing segments could be sold to private investors. The sale of up to 49% of the new ČEZ Energy entity is estimated to generate between 190 and 270 billion CZK.

Critics argue that this structure shifts systemic risks to taxpayers while allowing private entities, such as investment groups or coal magnate Pavel Tykač, to capture the profits. Tykač, who holds between 3% and 10% of ČEZ shares, holds significant leverage, as the state requires 90% ownership to squeeze out minority shareholders and finalize the transaction.