Czech state-run company CEZ, which supplies power to western Bulgaria, plans to pay a dividend of BGN 41 million to the Bulgarian government for the past four financial years, said regional manager Jan Vavera quoted by the Council of Ministers’ press office.

On Monday, Vavera met up with Bulgaria’s prime minister Boyko Borissov and assured him the Czech company will pay the government dividend for its 33% stake in the power distributor. He noted that the dividend payout will not affect the operations of the firm which he claimed had good liquidity.

The Bulgarian government and CEZ confirmed their commitment to work together over a memorandum for EUR 40 million investment by the company in energy efficiency and energy infrastructure.

According to the trade registry, CEZ Electro and CEZ Distribution have posted a combined profit of BGN 249.9 million profit for the past four years. Dividend will be paid in the form of 48% of the company’s profit for the period 2006-2009. The Bulgarian government can get payment against its 33% stake, with the balance of the profit, worth BGN 79 million, to be handed out to the Czech company.

In 2010, CEZ will invest BGN 71 million in grid expansion and upgrades.

Bulgaria’s power distributors have paid no dividend since going private in 2005. In 2005, they were threatened by premier Boyko Borissov that their privatisation contracts would be terminated unless they retroactively pay their dividends. Germany’s E.ON and Austria’s EVN have decided to only pay dividend on their 2009 profits, of BGN 1.6 million and BGN 1.65 million, respectively.