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UPDATE 1-Polish PM backs PGE takover of rival Energa

Published 09/14/2010, 10:58 AM
Updated 09/14/2010, 11:00 AM

* PM says backs PGE bid in Energa privatisation

* Tender to be decided around mid-September

* Analysts value treasury's 83 percent in Energa at $2.3 bln

(Adds detail, background)

WARSAW, Sept 14 (Reuters) - Poland's Prime Minister Donald Tusk on Tuesday backed top utility PGE's bid for state-controlled rival Energa, saying it would help the government implement its nuclear energy programme.

PGE, together with Czech Republic's Energeticky a Prumyslovy Holding (EPH), are the only bidders left in the race for the 83 percent stake in Energa, which analysts say could cost as much as 7 billion zlotys ($2.3 billion).

"A takeover of Energa by PGE will help carrying out the nuclear energy programme in Poland," Tusk told a news conference. "I am a dedicated supporter of decisions that will make the nuclear programme a reality."

PGE said that if it takes over northern-Poland based Energa it will make it a competence centre for its nuclear programme, which is aimed at building at least two power plants with a total of 6,000 megawatts in installed power.

The European Union's largest ex-communist state is pursuing nuclear energy to wean its economy off highly polluting coal, a source that currently generates more than 90 percent of the country's power needs.

The treasury has earlier said it would pick a winner around mid-September.

PGE was seen as the frontrunner in the race, but the anti-monopoly regulator UOKiK has publicly voiced concerns the merger would further limit competition on the market, raising questions whether the government would risk an extended approval process or a veto.

Prime Minister Tusk, who can dismiss the head of UOKiK, said on Tuesday the government had presented its arguments to the head of the regulator. (Reporting by Gabriela Baczynska, writing by Patryk Wasilewski; Editing by Will Waterman) ($1=3.058 Zloty)

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