The French energy group EDF has announced a share capital increase with preferential subscription rights to existing shareholders, for a gross amount of approximately €4bn.
The French State subscribed for an amount of €3bn (75% of the subscription rights) and as a result, it now holds a 83.10% stake in the company, versus 85.6% before the capital increase. In the meanwhile, the free float (share capital freely exchangeable on the stock exchange) has increased.
The proceeds from the Rights Issue will primarily be used to finance the Group’s development operations during the period between 2017 and 2020, in line with the CAP 2030 strategy, and more generally, to strengthen the Group’s financial flexibility. EDF is investing more than €20bn (£18bn) in the Hinkley Point C nuclear project in the United Kingdom and is taking over Areva NP, in a context of falling wholesale power prices in Europe, and significant delays and cost overruns in the construction of two EPR projects in Europe, Olkiluoto 3 (built by Areva), and Flamanville in France. In addition, EDF will need to invest at least €55bn to refurbish its existing nuclear fleet in France to operate beyond 40 years ("Grand Carénage" programme).
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