CEZ shares slipped more than 7% at one point in trading on Thursday as investors became nervous over what the change will mean for CEZ, which is 70% owned by the state. Analysts and some shareholders said the move weakened minority owners' rights.

CEZ shares have soared this year amid a record dividend and as the state discusses restructuring or splitting the country's dominant electricity producer, part of efforts to get greater control over energy production after a surge in prices last year.

Under the proposed change, approved by the government at its Wednesday cabinet meeting and still set to go before lawmakers, gaining 75% of votes of shareholders present at a general meeting will be enough to approve certain forms of divisions.

Currently, 90% support of all shareholders is required.

In the new bill, shareholders representing two third of the company's capital will be needed to reach a quorum, the government office said.

J&T Banka analysts said that participation at CEZ's last three general meetings was around 77-79%.

"If the law was adopted, the state could, with its 70% stake, decide on splitting the company on its own, against the will of minority shareholders," J&T said.

It added the law did not change rules for compensation which the state may need to offer in any takeover of assets.

Minority shareholder Michal Snobr, representing an investor group owning over 1% of CEZ, called the legal change an abuse of legislative power.

"It is a step that will forever disrupt the legal environment in the Czech Republic and trust in capital markets," Snobr said on Twitter.

The government press department did not provide the full wording of the approved version of the proposed legislation when contacted on Thursday.

CEZ shares ended May 11 at their highest closing price in 15 years but have retreated since. They traded at 1,060 crowns midday on Thursday, down 6.4%, giving the company a market capitalisation of 570.3 billion crowns ($26.85 billion).

CEZ saw profits soar last year, although new state levies and windfall taxes are hitting this year's earnings.

It reported a 60% drop in first-quarter adjusted net profit a week ago, and shares have corrected lower since.

Prime Minister Petr Fiala's government wants to decide on plans for CEZ this year as it seeks more control over some energy production, as well as creating easier conditions for investments into new nuclear power units that are tougher for privately-held companies to carry out.

($1 = 21.2420 Czech crowns)

(Reporting by Jason Hovet and Robert Muller; Editing by Mark Potter and Kim Coghill)

By Jason Hovet and Robert Muller