News Parkiet

Privatization

Bidders say PKO BP privatization rules unfair

Poland's most recent attempt to sell state lender PKO BP favors three potential bidders, who stand to gain from government's insistence on opaque privatization procedures, sources told PARKIET on Monday. 'Bidding rules basically say PKO BP privatization should be handled either by Dom Maklerski Penetrator (small, private equity broker controlled by Elektrim group) or DM Banku Handlowego (part of Citigroup) assisted by Ernst&Young Audit', says one source close to the deal.

Polish Treasury Ministry has already mailed fifteen bids. Winner of this year's biggest privatization sale will receive an estimated 16 to 18 million zloty.

Polish government has already canceled two previous bids for the privatization of PKO BP.

Petrochemicals

Grupa Lotos posts higher earnings

Grupa Lotos regional refinery holding has released preliminary earnings for 2003, showing sales of 8.4 billion zloty. Net earnings were up 150 percent to PLN 257 million.

Grupa Lotos is based on state-owned Gdańska refinery.

Airline industry

Air Polonia starts new route to Brussels

Belgium's Charleroi airport near Brussels has secured contract with Polish low-cost carrier Air Polonia, sources at the company said yesterday.

Air Polonia will offer flights from Warsaw and Katowice. Ticket sales start next week.

Telecommunications

Netia's shareholders push for board changes

Unnamed minority shareholders of Polish phone company Netia S.A. have asked its managers to call another shareholders' meeting, pushing for changes in company's board of directors. Netia's board now consists of six members, all of whom were picked by company's former bondholders. The firm, which has approximately 350.000 subscribers nation-wide, defaulted on its debts in almost two years ago. It managed to convert several hundred million worth of corporate bonds into new stock in a deal that gave bondholders 91 percent stake in the company.

Polish pension funds have accumulated 20 percent stake in Netia in recent months. Other large investors in Poland's second largest phone company include PZU insurance group and Pioneer Pekao Investment Management. Each owns approximately 5% of Netia's stock.

Mutual funds

SEC lowers fines for mutual fund companies

Polish mutual fund companies are getting better at compliance with industry regulations. Three years ago the SEC imposed fines totaling 210.000 zloty on six mutual fund companies. In 2002, financial penalties for misleading advertising practices and non-compliance with securities regulations fell to 55.000 zloty. No fines were paid last year.

Insurance

PZU to buy another insurer in Lithuania

Poland's leading insurance group PZU S.A. plans to buy Lithuania's fifth largest insurer, Norddeutsche Landesbank-controlled Nord/LB Lietuva, Lithuanian press reported yesterday. PZU already owns majority stake in UAB DK Lindra. Acquisition of Norddeutsche's Lithuanian unit would nearly double its share on the local market to approximately 15.8 percent. The two firms would have combined premiums of 34.3 million dollars. PZU representatives refused to comment on the transaction until the deal is formally closed.

Engineering

ZPUE sees higher earnings in 2004

Publicly traded maker of transformer stations ZPUE S.A. said preliminary figures show net earnings rose 54 percent to 2.8 million zloty last year. Sales were up 17 percent to PLN 91 million. Founded 15 years ago by Bogusław Wypychewicz, ZPUE wants to more than double its profits this year. Sales are set to rise to 100 million zloty for the first time ever.

Information Technology

No radical changes seen at IBM PolskaPoland is still a very difficult market, but IBM is on the right track to win top spot on the local market, the head of Polish unit said yesterday. CEO of IBM Polska Dariusz Fabiszewski told PARKIET in an interview. IBM's Polish unit plans major expansion into strategic consulting and other services. The firm wants to become Poland's no. 1 IT company in four years' time.