By Marek Miler
April 9 (Bloomberg) -- Pavel Kuta, deputy chairman of the
Czech National Property Fund, made the following comments on the
planned sale of the Czech government's 63 stake in Unipetrol AS,
the Czech Republic's largest oil and chemical holding company.
The National Property Fund is in charge of administering state
assets. Royal Dutch/Shell Group, Europe's second-biggest oil
company, Mol Rt. of Hungary and PKN Orlen SA of Poland were picked
to inspect Unipetrol's books and are expected to make binding
offers to the government next week. The inspection ends today.
Kuta spoke in an interview with Bloomberg News in Prague.
On the bidding deadline:
After more information was made available an extra week for
the due diligence ``is enough. There is no reason to extend that
more because April 23 is when we will be getting final bids.''
Unipetrol ``released some more data on business between the
units and some contracts that Mol and PKN requested.''
On contracts between IOC -- the group of Conoco, Inc., Agip SpA,
Shell -- and Unipetrol, the two shareholders in refinery Ceska
Rafinerska AS, which Mol and PKN also wanted to inspect:
``IOC didn't release them. It obviously is a problem partly,
but unfortunately this is something that was outside our control.
It is even outside the control of Unipetrol.
``Such a release requires approval from all shareholders, four
entities, and at least one did not give its approval.''
On how IOC's option to buy the rest of Rafinerska complicates the
sale:
``It is definitely a substantial thing, but on the other hand
it is not a new thing. During the previous sale, the option
mechanism already existed and bidders came and offers were
placed.''
On whether IOC plans to execute its option:
``We have no such information. We obviously put those
questions to the companies through our advisers, and the answer we
got was that it will be considered. It is quite understandable.
Nothing presses them and they have no obligation toward us.
``There is a possibility'' that the bids would be made for
Unipetrol with 51 percent of Rafinerska for Unipetrol without that
stake.
On why Borsodchem Rt. and Kazmunaigaz are part of the inspection of
Unipetrol's books:
``The role of a lead bidder allows the company to be the
contractual partner to the government in the final agreement. In
other words, the government said we are bringing these three
companies into the shortlist and with them we will close the
transaction.
``The second part of the process is that the lead bidder can,
according to the approved rules, create formal and informal
consortia.''
On how big the bids could be:
``I was an optimist but part of the optimism has been taken
away from me by the government's decision to narrow the shortlist
only to the three companies, out of which two were at that time
mulling a regional merger in some way.
``I think that the government undoubtedly had a good reason
for eliminating some other bidders but at the same time they
reduced the competitiveness of that process and this will
undoubtedly have an impact on the price.
``I do not dare to make a prediction for the size of the bids
but I am much less optimistic than at the beginning because'' the
government excluded bidders ``which were relatively aggressive in
the area of price.''
--Editors: Coulter, Morris, G. Reynolds.
Story illustration: {UNIP CP CNP00094090102 }
for more information on the sale.
To contact the reporter on this story:
Marek Miler in Prague (420) 224 422 100 or at
m.miler@bloomberg.net
To contact the editors for this story:
Tim Coulter at (44) (207) 330-7901 or wmorris@bloomberg.net
