Polish Business Survey

Alan Heath
07-04-2000, 00:00

Polish Business Survey

Citibank may not get want it wants

Citibank is waiting for a decision from the Polish Banking Security Commission on whether or not it can buy Bank Handlowy, one of Poland s oldest institutions with a history going back to the nineteenth century. The commission must decide if Citibank can get a majority share in the bank and if it will be allowed to change the Polish bankŐs name. Citibank uses the same name throughout the world and incorporates acquisitions within its own structure. Many banks have been recently bought by foreign companies and there is political pressure to brake this process. Experts therefore believe that the Americans may be allowed to buy only 50 percent of Bank Handlowy stock and not the 75 percent they had planned.

Investor loses interest in Warsaw Bourse

Józef Hubert Gierowski, a major investor on the Warsaw stock exchange, has decided that a safer place for his money will be in real estate. He believes that the present day situation on the worldŐs stock markets does not encourage investors and that is why he is pulling out. He also does not agree with investing in the IT sector saying that currently quoted prices for stock is well above its real value. However he did state that he feels that Polish stock is an attractive investment for foreigners.

Four insurers show interest in Warta

Kulczyk Holding, majority shareholder in insurance giant Warta, has announced that it is prepared to sell a 25 percent share of this company. The German Allianz, French Axa, Dutch Fortis and AIG from the USA have all shown an interest but consider that 25 percent is too little. Another difficulty in the price which is a good fifty percent higher than most companies would be prepared to pay for a minority holding. Even the current share price is considered to be more than Warta is worth.

Last year Warta reported a profit of PLN75.6m.

MAN increases investments in Poland

German truck manufacturer MAN has announced that it will shortly open a new service centre near Poznań and two more later in Katowice and Gdańsk. These service centres make up only a part of the groupŐs investments in Poland. The largest bill so far is from the purchase of the Zadada factories in Starachowice near Kielce. Modernisation of the production line there will cost around DEM25m. Star Trucks, a subsidiary of MAN wants to produce lorries in Poland moving from the present facility in Munich which will produce another model.

MAN also produces buses in Poznań which will be producing 400 units annually in a few years time. Most of these buses will be exported. New production lines here will cost around DEM16m.

MAN thinks that it will sell around 780 lorries in the first half of this year. This would be an increase of twenty percent over the same period in 1999. A new client will be the Polish military following entry into NATO.

The Germans are known to be looking for Polish companies to buy. Two of these companies could well be Jelcz and Autosan which were bought by Pol-Mot from Zasada last year.

Hans Gźnter Heitzer, MD of MAN Polska and Star Trucks, sees a lot of similarity between the Polish market today and that which existed in Portugal 15 years ago. In Portugal most lorries needed to be replaced but their owners did not have the resources to do so. However PortugalŐs economic success came to their rescue and thus aided lorry manufacturers.

Meat producers seek new markets

Polish pork producers still suffering from their collapse of their markets in Russia could find new export markets. Both the EU and North America will have lower pork production this year, a gap which may be filled in part by Polish production. Nonetheless, the best markets are in the Far East. Major importers include Japan (814,000 tons annually), Hongkong (221,000 tons annually and South Korea (124,000 tons). Unfortunately Polish producers have no track records in these markets. One of PolandŐs biggest pork producers, Animex, is owned by Smithfield Foods, who have a strong position in these markets. This will strongly aid the Poles. Another company Farm Food is above all concentrating on Korea.

Last year the export of white meat was higher than its imports for the first time in a long while. One of the major exporters is Indykpol from Olsztyń. The most important market is the EU.

Optimus to be sold in parts

Optimus is the largest Polish IT company. Within the next three months it could be sold off in parts. Its real estate section, Optimus Real Estate, will be the first to go. It has five buildings in the southern part of Warsaw as well as others in Bydgoszcz, Poznań and Wrocław. The value of this company has been assessed by Merrill Lynch at around USD50m.

Optimus is also looking to sell off its factory and distribution network. This is one of the largest areas of business for the company but its constantly less profitable. Those interested in its purchase include Compaq, Fujitsu Siemens and Hewlett Packard. This sale would be worth around USD6m.

© ℗
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Podpis: Alan Heath

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