Polish Business Survey
Stock market looking weak
The beginning of the week did not look promising for investors on the Warsaw stock market. The hopes linked to the PKN share offer, which closed last week with many small buyers taking up a large slice of the company, were dashed and shares continued to slide.
Elektrim board under fire
Yesterday investment fund Templeton officially requested changes on the management board of Elektrim following Friday s shareholders meeting which led to a 3.6 percent fall in the value of the company s stock.
Templeton has emerged as being the leader of the group of shareholders opposed to management plans. Templeton claims that it believes that the management board is not keeping the shareholders properly informed. Templeton has around five percent of the shares in the company and will need a ten percent vote to effect any changes. It is now looking for allies amongst other shareholders.
Elektrim has stated that its board members were chosen for a three year period and they are all specialists in the branches the company is seeking to specialise in. Templeton does not disagree with the overall strategy of the holding and believes that recent agreements with Vivendi and Eastbridge together with the possible addition of Deutsche Telekom could lead to Elektrim being one of the most attractive companies in which to invest in the region.
Templeton s strategy is however unclear. While it agrees that Elektrim needs capital for new projects it has blocked a proposed bond issue.
Computerland tackles telecoms
Computerland is aiming to get a larger share of the telecommunications market following yesterday s contract with Intec Telecom Systems for the sale of inter-operator accounting systems. This is the second such agreement, following one a few weeks ago with Warsaw based systems integrator Openet Telecom which provides billing systems. The decided market leader of this kind of service is Kraków based ComArch.
Steelworks raises capital
At the annual shareholders meeting of the Łaziska steel mill it was decided to increase the capitalisation of the company by PLN7m to PLN42m. The new share issue is directed at Gemi, which would allow them to increase their holding from 53 percent to 60 percent. Despite the increased capitalisation the company will continue to look for an investor. The greatest problem facing the mill is the size of its debts to its energy supplier the Upper Silesian Energy Concern (GZE). According to Radosław Miśkiewicz, the owner of Gemi, the mill is one of the largest users of energy in the country and the purchase of energy is 60 percent of all costs. In 1999 receipts were PLN180m, 60 percent of which was for export. Nonetheless the company made a loss which has not yet been made public. This year Radosław Miśkiewicz says that the mill will be in the black.
Pension funds calling the shots
Pension funds are now playing a bigger role on the stock market. A recent example is how several funds such as Dom and PZU Złota Jesień successfully blocked the proposals of Michelin at the AGM of tyre producer Stomil Olsztyn. The following day at the AGM of Computerland, pension companies blocked management proposals and two of their representatives were elected to the board.
However the opinion of Maciej Jankowski of Commercial Union is that the pension companies should accept the strategy of a company it has invested in. A similar idea is expressed by Michał Szczurek who shall shortly be MD of Nationale Nederlande s fund who believes that the funds will not be significant players on the market. There are few domestic investors which makes the role of the pension companies seem larger that it would in Western Europe or North America.
New law for PKP
Next week there will be the second reading of a bill concerning the restructuring and privatisation of national rail carrier PKP.
One of the innovations of this new bill are the division of the company into separate entities. The first will be for infrastructure and will include not only railway lines but also energy, telecommunications etc., the second will be for goods and the remaining two will be for long distance and regional passenger services. With the exception of the infrastructure, the companies are to be privatised.
Debts of the PKP are now PLN6.2bn, which will reach PLN7bn before the end of the year. The bill proposes that these sums shall be paid but without interest.
The workforce is to be reduced by 43,000 from 184,000 at present. Early retirement will be permitted, younger people will receive redundancy pay of between PLN20,000-PLN30,000.
More than 500,000 employees and former employees will receive their part of a 15 percent share in the sale of PKP property.
Zdzisław Denysiuk heading the parliamentary committee on the restructuring of the PKP believes that the bill could be law by the end of next month.© ℗
Podpis: Alan Heath