Akcie: This week was one of the poorest in the history of the Prague Stock Exchange

Týdenní zpráva Komerční banky Datum : 1.12.2000

This week was one of the poorest in the history of the Prague Stock Exchange. Czech shares suffered mainly due to a panic sell off of Cesky Telecom. The PX 50 index dropped 7.8% to 409.9 this week and has lost 16.3% since the beginning of the year. Cesky Telecom was the worst performing stock declining, by 14.7% to CZK 381.3. Ceska Sporitelna and Ceske Radiokomunikace followed with losses of 5.9% and 5.3%, respectively. CEZ also went down significantly, dropping by 6.1% to CZK 81.9. Relatively better performers were shares of Komercni banka, which lost just 2.0% to CZK 735.3. Unipetrol and Tabak outperformed the market, declining by 3.0% and 0.9%, respectively.

       On Monday 4 December, there is a deadline for preliminary bids for a 51% stake in Ceske Radiokomunikace. A possible leak of information about the number of interested companies and preferably some names can be expected. The more bidders the better for the share price of the company. TeleDanmark, Deutsche Telecom, Vivendi, Telecom Italia and two investment funds have already showed interest. Nevertheless, recent news indicated that there are already ten companies interested in Ceske Radiokomunikace. However, the uncertainty about the obligation to offer a buyout for minority shareholders close to the acquisition price could reduce interest. The government should also discuss granting three out of four UMTS licenses to current operators. There should be an auction for the fourth license. It is currently very difficult to value the UMTS license, however it is deemed to be inevitable for survival of the current operators. Therefore we see the government's decision as positive because it reduces the risks the current operators would end up without UMTS license. The last questions remain the price of the license and its conditions. The development on foreign markets will again be crucial for Czech shares.

       Speculations developed about the obligation to provide minority shareholders an offer to buyout their shares during privatization. According to the current law, the government can make an exemption in the case of privatization. Nevertheless, it was disabled by the recent amendment to the commercial code. The NPF and the Ministry of Finance are looking for ways to avoid this, there are also different interpretations among lawyers. NPF and the Ministry of Finance see a quick amendment to the commercial code as the easiest solution.