Polish Business Survey
Oliwa wants to buy Polifarb
In the middle of November the Pomeranian province hopes to close the privatisation of Polifarb Oliwa. The Oliwa retail network hopes to buy Polifarb with whom it is not related despite the similarity in name.
Polifarb Oliwa has around a twenty percent market share in anti-corrosion paints.
Oliwa has already proposed a formal capital investment in the company of between PLN12m – PLN14m and has a signed a social package with the trade unions.
Employees will have 42 months of guaranteed employment as well as privatisation bounties. An amount of minimum employment has also been set at 204 people, currently the plant employs 230.
Krzysztof Bruski, director of Polifarb Oliwa also said that there several other companies, some of them from abroad, were interested.
KGHM Metale pulls out of zone deal
KGHM Metale which is based in Lubin in south western Poland planned a USD70m investment in the production of copper foil and USD30m in pipe preparation. The factory was to have been based in the Legnice special economic zone. The factory is no longer to be.
Janusz Cendrowski, managing director of the company has withdrawn from this plan saying that it is in accordance with the policy of mother company KGHM Polska Miedź which no longer wished to be involved in the manufacture of copper goods.
He underlined that other copper mining companies had also withdrawn from the sector. Janusz Cendrowski also added that sometimes it is better to buy an already existing company rather than take a green field site for development.
Krzysztof Skoczyński, analyst at CDM Pekao SA also believes that the Lubin firm made the right decision as the holding does not have the experience in distributing manufactured goods.
The most important reason for pulling out of the scheme however was the withdrawal of Circuit Foil who were to be KGHMŐs partners in copper manufacturing. To make matters worse the Italian ICC who were to be partners in the pipe production also pulled out. Janusz Cendrowski claims that he does not know why they gave up as there is demand on the market for this type of product.
Former head of KGHM, Stanisław Sewierski also does not agree with the idea of pulling out of copper goods manufacture. He believes that the company should seek advanced technology to allow modern production methods. At the moment it cannot put money into the cable industry because competition in Poland is very tight. However it was a good idea, he argues, to invest in metal foil. Another aspect also has to be considered and that is that of employment. Of course it is not the aim of KGHM to create jobs but it should not be forgotten that fewer people will be employed in mining and that some consideration should be given for them in the opinion of the company’s former managing director.
Ryszard Zbrzyzny leader of the copper workers union also refers to the amount of jobs that will be lost. He says that the reason why KGHM lost its partners was due to lack of funds which had been used for other things such as investing in the television station Telewizja Familijna. This is not an opinion which is backed up by the accounts of the company which show a clear profit of PLN300m in the first half of the year. The company does not lack the cash.
Cendrowski says that the company is beginning to act like a venture capital fund and can place capital in various market sectors.
Deficit to drop this year
Good results on the current account suggest that this years deficit will be less than in 1999. Nonetheless it is still too high and analysts see no reason for celebrating. Others see it as the beginning of an improvement in the Polish economy but there is still no reason to hope for a reduction in interest rates.
Ster wants to build factory
Poznań based Ster is seeking real estate to build a new car and tram seat factory. Next year it hopes to increase production by up to a factor of ten.
It also does not rule out seeking an investor.
Pension funds further liberalised
The chamber of commerce representing the pension funds has prepared a project which would allow them to change their investment rules and enlarges the areas in which they can place funds. In the opinion of industry experts this will make their investments safer at the same time as increasing diversity.
Cobblers to ZUS
The Chełmek shoe manufacturing company can count on a PLN18.5m debt it owes the social security organ ZUS and income tax authorities to be frozen. Thanks to the reduction of its debt and an order to supply the German army with boots, it can count on coming out of the red for the first time in a long time. The German order also means that it will be increasing employment from 550 to 700.