News Parkiet

Insurance

Hedge funds,

individuals buy PZU shares

International hedge funds, including one fund controlled by Deutsche Bank as well as private Polish investors are accumulating sizable stakes in the privately held insurer Powszechny Zakład Ubezpieczeniowy. Although plans for PZU?s Initial Public Offering were suspended months ago, private investors are still willing to pay between 220 and 230 zloty a share, banking on future listing of the country?s biggest insurance company and a steady stream of dividend payments. The sellers include PZU workers, who received a small stake in the company a while ago.

One of the more aggressive buyers, Cayman Islands-registered QVT Fund LP, a Deutsche Bank controlled hedge fund, owns 254 200 shares of PZU representing 0.29 percent of the total. Another major shareholder, US-based Manchester Securities Corporation spent millions accumulating 3.89 percent stake. MSC owns 3.36 million shares of PZU, making it the third-largest shareholder. At curb market prices its stake is now worth approximately 755 million zloty, or 240 million dollars.

Individual Polish shareholders, mainly private investors from Silesia, own about 2 percent of PZU. ?The price is still very attractive when you look at PZU?s recent earnings. And they?ll go public sooner or later?, one shareholder told PARKIET this week.

PZU plans to pay as much as 708 million zloty in dividends this year, raising its dividend per share to 8.2 zloty.

Personal finance

Bond funds post double-digit gains

Top Polish bond funds have outperformed many equity funds in the last twelve months, surprising even fund managers themselves. One bond fund, managed by DZ WBK AIB TFI, a mutual fund company set up by Allied Irish and its Polish unit, Bank Zachodni WBK, posted 13.5 percent gain in the twelve months to June, benefiting from lower interest rates and declining bond yields. Fourteen of the 23 bond funds monitored by PARKIET posted double-digit gains over the same period of time. That compares with an average 10.8 percent gain by eighteen equity funds since mid-June 2004.

Asset managers are warning that bond rally won?t last forever. ?We are entering a dangerous pre-election period?, Cezary Iwański, vice-CEO of Pioneer Pekao Investment Management says. Another money manager, PZU TFI?s Adam Ruciński expects greater volatility on the bond market and says investors might consider switching their assets from bonds to stocks after the summer holidays.

Information technology

ComputerLand

to expand export sales

Poland?s no. 2 information technology group, Warsaw-based ComputerLand says it is expanding its Eastern European operations, working on a possible acquisition in Ukraine. The company plans to increase its international sales to 20 percent of total revenues in two years? time. ComputerLand and its various subsidiaries now have annual sales of around 740 million zloty.

Footwear industry

New import quotas won?t harm CCC,

executive says

New quotas on shoe imports from China are unlikely to have a major impact on publicly traded footwear retailer CCC, senior company executive told PARKIET this week. CCC, which has about 300 retail outlets across Poland, selling lower-end shoes and accessories, makes about 20 percent of the shoes it sells at a tax-exempt factory near Legnica. The balance is imported from elsewhere, mainly from China, Mariusz Gnych admitted in a telephone interview yesterday.

?Products imported from China account for about 50 percent of our sales?, Gnych said, adding that EU-China dispute over shoe imports centers on leather goods, rather than synthetic-based products sold by CCC.

Telecommunications

Vivendi seeks a compromise

with ElektrimFrance?s Vivendi has reiterated its offer to pay Elektrim power and telecoms group another 650 million euro for a stake in a holding company that would own part of Polska Telefonia Cyfrowa, the biggest of Poland?s three mobile phone companies. Vivendi, Elektrim and Deutsche Telekom, which owns the remaining 49 percent of PTC, are embroiled in a dispute over the ownership of PTC. Nonetheless Vivendi, which invested 1.8 billion euros in Elektrim-Telekomunikacja, a holding company that, depending on whose version of events you believe, either owns, or used to own a major stake in PTC, says it is keeping lines of communications open and is working to end the dispute, company officials said.