Polish Insurer PZU Expects Earnings Boost From Investment in Bank Pekao
08 December 2016 - 9:45PM
Dow Jones News
By Martin M. Sobczyk
WARSAW--PZU SA (PZU.WA) Chief Executive Michal Krupinski said
the Polish insurer's acquisition of a controlling stake in Bank
Pekao SA (PEO.WA) should improve earnings a share by around 10% to
11% in the coming years.
The price that PZU, Poland's largest insurer, agreed to pay for
a 32.8% stake in a $2.57 billion deal done jointly with Polish
state investment fund PFR is attractive considering recent market
trends, Mr. Krupinski said on Thursday.
PZU will buy 20% in Pekao and PFR will buy an additional 12.8%
for 123 zlotys ($29.90) a share from Italy's Unicredit SpA
(UCG.MI), which last sold a stake in Pekao in July at PLN126 a
share.
Pekao was trading at PLN119.4 in morning trade in Warsaw, down
0.9%. PZU was 4.6% higher.
Unicredit said it will sell its remaining 7.3% stake on the open
market. PFR said on Thursday Unicredit will likely hold on to the
stake until 2019.
PZU will finance the takeover using its own cash and through the
sale of liquid assets.
PZU also said it's not negotiating further large acquisitions at
this point. Its banking unit, Alior Bank, said this week it ended
talks to buy the Polish banking unit of Austria's Raiffeisen Bank
International AG.
PZU expects closing of the Pekao acquisition in the beginning of
the second quarter of 2017. It has no plan to immediately further
boost its stake in Pekao, PZU's CEO said.
Write to Martin M. Sobczyk at martin.sobczyk@wsj.com
(END) Dow Jones Newswires
December 08, 2016 05:30 ET (10:30 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
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