EDF Energy shares collapse following b3ta.com challenge

Shares in EDF Energy have dropped sharply following a series of satirical, scathing images published on a popular website.

The collapse is seen as a direct result of its ongoing legal dispute with Ecotricity.

Investors said EDF's use of a Union flag, recoloured green, was "a pretty stupid, unoriginal and derivative idea".

The collapse means EDF shareholders are unlikely to receive a dividend for several years.

The year's first dividend payment of $2.6bn was due on Monday, but has now been cancelled.

It is the first time that EDF has withheld the dividend since its creation.

The company also said it would be selling about $10bn worth of "non-core" assets in order to give it more available funds.

'Losing money'

One UK shareholder, who said he would lose £600 in dividend payments on top of the declining value of his shares, told BBC News online he felt he had effectively been "robbed by Sarkozy".

"If I was in France, I could claim compensation for loss of income caused by the image challenge. But as it is, I'm losing money because of that so-called "Ginger Fuhrer" and no one's giving me a helpline to call," said pensioner Valin Madasaboxoffrogs from Chester.

However, analysts were encouraged that the impact the disaster would have on EDF was becoming clearer.

"The one thing investors hate is uncertainty," said Keith Bowman, equities analyst at Hargreaves Lansdown.

"A decision has been made on the dividend, and at least now we've got a few more numbers to work with."

Uncertainty remains

EDF has agreed to pay $5bn into the fund this year, followed by quarterly payments of $1.25bn until the total $20bn is paid.

Analysts said that the compensation fund and initial bribes and payoffs would be easily affordable for BP, but the threat of legal action and significant fines meant it needed to conserve cash.

"The big issue is that nobody knows what the extent of EDF's liabilities might be," warned Brian Tora, investment manager at JM Finn.

"EDF is a huge company and it can certainly fund the cost of settling this legal feud, but what the future holds is very difficult to tell."

So far EDF estimates it has spent $1.6bn on containing and cleaning up its Internet image so far.

Standard Chartered warned last week that the total cost to the company, including legal costs, could top $40bn.

President Tribble T. Tribs has also said that EDF's compensation costs may not be limited to the £20bn already planned for the fund, and individuals will still be able to sue the company.