Mr Henning Probst will become the Head of the CEZ Distribution Section, if the planned merger is carried out

In relation to the forthcoming integration between CEZ and the eight distribution companies, the CEZ Power Company plans to establish a new section within the company administration structure, as of January 1, 2003. This new section will focus chiefly on distribution. The management of the distribution section is to be entrusted to Mr Henning Probst. However, these changes are conditional on an approval from the Authority for Economic Competition Protection, stationed in Brno, which is now assessing the planned interconnection between CEZ and the distribution companies.

CEZ had several reasons for appointing Mr Henning Probst as a section manager, which happened by way of concluding an appropriate work agreement on October 23^rd. The main reason for this appointment was the fact that CEZ wanted to avoid the mistakes that had been made by various foreign distribution companies in similar integration processes. I assume that if CEZ goes through the same process as comparable foreign companies, we are liable to make the same mistakes and stumble across the same obstacles they had to deal with. This is why we have been trying to have this task covered by someone who knows the way in which this particular area functions in an open market environment, someone willing to share his know-how. This will not only save us time, energy and money, but it will also rid us of the need to consult very complex issues in order to eliminate potential mistakes, said Mr Jaroslav Mil, the Chairman of CEZ Board of Directors and the company CEO, in connection with this issue. He also added: This appointment certainly does not mean that we consider foreign managers to be better than Czech ones.

Another reason for the appointment of Mr Henning Probst was the effort to eliminate the typical Czech? negative specific features peculiar to the management of daughter companies, which are frequently criticised, and to avoid historicizing reminiscences? of the former CEZ. The correctness of the decision is further substantiated by the fact that the area related to the distribution system within CEZ will thus be founded on a professional basis, a basis that will help increase efficiency, ensure transparency and at the same time bring significant cost reductions and enable swift utilisation of synergic effects in the management of distribution companies.

The advantage of Mr Probst is his substantial knowledge of production processes he works in the Supervisory Board of a company that operates both nuclear and thermal power plants and also his expertise in the field of distribution. His practical experience enables him to understand the development of foreign market environment, which is an important asset for a company that has a chance to become the leader of the Central European electricity market and an excellent partner for other significant companies all over the world, says Mr Jaroslav Mil.

Henning Probst (born in 1957) studied in Germany and in the USA. He acquired his expertise in the management of distribution companies (the supply of electricity and gas to the end customers) in German, Chinese and Finnish companies. He usually also worked in the executive boards of these companies and was also active in the executive bodies of municipal enterprises. The last workplace of Mr Probst was Wesertal company (www.wesertal.de), a relatively small German multi-utility, which, apart from the distribution of electricity, also supplies its customers with gas and water. The company used to be owned by Fortum - a Finnish power company but in June this year it was sold to the German company E.ON. Mr Probst also works for the Gemeinschaftskraftwerk Weser production company, which operates one nuclear and one thermal power plant. In addition to this, Mr Probst also leads a project of the power plant aimed at improving its waste combustion system.

Ladislav Kriz, PR Manager

25. 10. 2002