How will a reluctant EDF chief affect partnership?
I'm reading between the lines here, but it sounds like the Sarkozy government pushed the French EDF Group's deal with Constellation Energy to go through even though incoming EDF boss Henri Proglio has his doubts about it. Without Proglio's wholehearted support, I wonder how well the partnership will work out.
Last week reports surfaced in the French press that Proglio was skeptical of the agreement with Constellation and was looking for a way out. He met in closed session with a parliamentary committee. Some of the legislators leaked his testimony to reporters.
But late last week there was push-back. French government sources were telling reporters that the Sarkozy administration still supported the deal, suggesting that Proglio was told to swallow it. (The French government owns most of EDF's stock.)
In any event, the agreement would have been hard for the French to dump if Constellation had wanted to go through with it. There was a signed contract requiring the agreement of both parties if the deal were to be scrapped -- absent extraordinary conditions such as a huge change in the outlook for nuclear power. And if EDF withdrew its $4.5 billion investment in the nuclear business, Constellation had the option to sell EDF several fossil-fired generation plants -- mainly coal. Proglio almost certainly didn't want those.
Still, launching the partnership with indications of skepticism from the French CEO creates a shadow. Pierre Gadonneix, EDF's outgoing CEO who strongly supported the Constellation partnership, said in a company press release that EDF is "eager to enhance its presence in the United States." There was no statement from Proglio.
