April 9, 2018 / 10:02 AM / in 4 months

Portugal's EDP says no talks with Engie after bid report

PARIS/LISBON (Reuters) - Portuguese energy and utility group EDP (EDP.LS) said there had been no contact with Engie (ENGIE.PA) after France’s BFM Business reported on its website that French utility Engie was examining a possible bid.

FILE PHOTO: The Engie logo is pictured on working helmets during a press visit at Engie windfarm in Radenac in Brittany, France, October 3, 2017. REUTERS/Stephane Mahe/File Photo

Engie said it had no comment to make on the BFM Business report, which quoted sources close to Engie.

EDP said in a statement that “no contacts have been established, nor have there been any negotiations with a view to consolidating operations.”

EDP shares were up 3.8 percent at 3.2 euros in at 0955 GMT after gains of over 5 percent earlier in the session, while Engie shares dipped 0.4 percent.

At that price, EDP has a stock market capitalisation of around 11.7 billion euros ($14.4 billion), while Engie has a market capitalisation of around 33 billion euros.

There were reports last year that Spain’s Gas Natural GAS.MC was seeking a merger with EDP, but the company denied there were any talks at the time.

China Three Gorges, EDP’s largest shareholder, has continued to raise its stake in EDP since reports of Gas Natural’s interest. The Chinese power company last boosted its holding in EDP, to 26.27 percent, in October.

The European utilities sector received a jolt last month when Germany’s top utilities announced plans to break up Innogy (IGY.DE), whose assets will be divided among parent RWE (RWEG.DE) and rival E.ON EONGnDE.

BFM Business added that any final decision as to whether or not to go ahead with a bid would not be made until Engie’s new chairman Jean-Pierre Clamadieu formally took up his position in May.

Clamadieu had said in February that Engie should consider acquisition opportunities.

Last month, Engie said its three-year transformation plan had been completed ahead of schedule, as it returned to profit after two years of losses and posted a higher-than-expected dividend.

($1 = 0.8151 euros)

Reporting by Sudip Kar-Gupta and Jean-Michel Belot and Axel Bugge in Lisbon; Editing by Keith Weir

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