February 13, 2019 / 4:34 PM / 5 months ago

UPDATE 1-EDF shares hit 3-month high on report French govt may delist company

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LONDON, Feb 13 (Reuters) - Shares in EDF Energy jumped to three-month highs on Wednesday after Bloomberg reported the French government is considering buying out minority shareholders in the French utility, the first step in a corporate restructuring.

The changes would be aimed at addressing the challenge of replacing the country’s nuclear power backbone, the report said.

At 1541 GMT, the shares were up 2.52 percent, having earlier risen 7 percent to a peak of 15.475 euros ($17.48), their highest since Nov. 15.

The government has asked EDF, in which it owns 84 percent, to propose changes in its structure, with the utility’s cash flows vulnerable to volatile power prices and intensifying competition.

The Finance Ministry declined to comment on the report, while the president’s office and EDF were not immediately available.

EDF is likely to be taken into full state ownership, with nuclear operations being placed in a parent company and other businesses such as renewables in units, the report said, citing a person at the utility who asked not to be identified.

Nationalisation could help the utility cope with the state’s plan to reduce France’s dependence on nuclear power by phasing out some reactors, while also giving it the means to participate in the development of renewable energy, the report said, citing a person familiar with the government’s thinking.

The company is expected to submit its proposal to the government by July, another person said.

The French government has long been looking at how to restructure EDF in order to isolate its nuclear business from stock market pressure.

In November, president Emmanuel Macron asked the firm to formulate proposals along those lines.

An Elysee note on the long-term strategy towards EDF said the state could raise its 83.7 percent stake in the utility.

$1 = 0.8855 euros Reporting by Josephine Mason in LONDON, Leigh Thomas, Jean-Baptiste Vey and Geert De Clercq in PARIS; Editing by Susan Fenton and Jan Harvey

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