Warsaw (Puls Biznesu) – The Ministry of the Treasure is ready to buy back PZU shares from Eureko, the minority shareholder of Poland’s biggest insurance company. The state will not pay for the shares, however. PZU will do it alone.
The Ministry of the Treasure which does not want Dutch Eureko among PZU owners, considers to buy out the minority shareholder. The price, i.e. PLN 10 billion (EUR 2.6 billion), would not burden the budget. PZU would buy its shares alone. Wojciech Jasinski, the Minister of the Treasure accepts this solution, “PB” learnt from people close to the insurance company. Would the Dutchmen agree to that?
“It is a theoretical question. So far, the state has not presented us any offer”, Ernst Jansen, Eureko deputy CEO said.
He repeated, however, that because of the potential of the Polish market and PZU, Eureko is not going to withdraw from Poland. However, the conflict between PZU two main shareholders: the treasure and Eureko is getting worse every day.
“It hasn’t been that bad for seven years”, Ernst Jansen admitted.
Since last Wednesday, Eureko has been withdrawing its people from the boards of PZU and PZU Zycie. Last Thursday, Eureko representatives lost their posts in the supervisory boards of five companies from PZU group. This week, the new supervisory boards will dismiss Eureko’s representatives from the boards of directors. In effect, out of above 10 representatives of Eureko in PZU group, only half of them will remain in supervisory boards. PZU is Eureko’s key investment in this part of Europe. The Dutchmen paid PLN 5.5 billion for their 36.1 percent stake.
Eureko hopes that the arbitrary court in Brussels will decide it is right. In the first part of the proceedings, two out of three judges decided that Poland broke the mutual investment agreement with the Netherlands. Eureko demands EUR 1.5-2 billion of compensation for the fact that they have not become PZU majority shareholder since 2001. The chances to win the proceeding are 50:50. According to “PB” sources, the Ministry of the Treasure is considering to withdraw from the arbitrary proceedings. Eureko would then have to file a suit in a Polish court. The proceedings may last for years with Eureko deprived of control over PZU.
Maybe it would be easier for Eureko to withdraw from PZU. No government will agree to pay PLN 12 billion of damages and give the control over the country’s biggest insurance company. Although PLN 10 billion seems a very high amount, the price may be even higher. Then, PKO BP would support PZU in the buy out. The Ministry of the Treasure would also win here: the stock would be listed while the government would steel have control over the insurer. PZU should have no problem with buying its stake from Eureko. In the middle of this year, it had PLN 2.3 billion of net income, PLN 10.7 billion of its own funds and PLN 9.6 billion of capital surplus.
(PLN 1 = EUR 0.258)