Monthly Archives: March 2010

Millenius claims just over 10% of voting rights in Orco

Orco Property Group appears to be acknowledging on its website that Millenius Investments now controls 10.07% of the voting rights in the company. Crossing the ten percent barrier is big, because it means you can call an extraordinary shareholders meeting, and these activist shareholders have a clear idea of the agenda at that meeting.

Here’s the note in full:

Paris, March 26th 2010 — By letter dated March 24, 2010, Millenius Investments S.A., a société anonyme (public limited company) incorporated under Luxembourg law, with registered office at L-1130 Luxembourg, 37, rue d’ Anvers, registered with Luxembourg Trade Register under number B149.60, Clannathone Stern S.A., a société anonyme, incorporated under the laws of Belgium, with registered office at 11, rue des Colonies, B-1000 Bruxelles, registered under number 0867341435 and Bugle Investments Ltd., an international business company, incorporated under the laws of the Republic of Seychelles with registered office at Suite 13, First Floor, Oliaji Trade Center, Franchis Rachel Street, Victoria, Mahe, Republic of Seychelles (the “Notifying Companies”) according to which Notifying Companies hold together 1,104,600 company’s shares entitling to 10,09% of the total vote in the company.

We assume the first gathering of shareholders Millenius calls won’t be the decisive one, because you need to have 50% of the shares present to get things done. Rules change, we’re told for the second one…

Goldman Sachs in Warsaw?

Polish developers take note: Bloomberg claims Goldman Sachs is looking to open a branch in Warsaw in order to get a piece of the action as the Polish government plans to sell off $10bn in its energy, insurance, chemical and phone companies in order to finance the hole in the national budget. GS probably isn’t the only one looking to come to town either.

Kranebitter takes over at Hypo Alpe-Adria-Bank

For those who follow such things closely, there’s a new guy in charge at Hypo Alpe-Adria-Bank. The outoing Franz Pinkl posted a letter last month on the company’s website, while the announcement of the new CEO, Gottwald Kranebitter, has now been put up. Kranebitter set up the Bratislava office of KPMG back in the 1990’s and has been consulting for Hypo Alpe-Adria-Bank since the end of last year.

Gottwald Kranebitter succeeds Franz Pinkl as Chairman of the Executive Board of Hypo Alpe-Adria-Bank International AG. The Executive Board will be reduced in size, from 5 members down to 4. Wolfgang Edelmüller has been recruited as Vice Chairman of the Executive Board and Chief Risk Officer. Johannes Proksch will in future be responsible for the group’s finances. The Chief Operating Officer position will be filled at a later point.

Deutsche Boerse jobs to move to Prague

BusinessWeek headline: Deutsche Boerse Moves Jobs to Prague to Save Money.

Sorry, Frankfurt, but this is precisely the kind of silver lining CEE property people always hoped would follow the dark storm clouds of recession.

The Frankfurt-based company said 370 jobs will be affected, with about two-thirds shifted to the Czech Republic, according to a statement. The 100 million euros in cost cuts are in addition to 50 million euros in annual savings beginning in 2011 that Deutsche Boerse announced in February.

“We value the additional cost saving program clearly as positive news which enables Deutsche Boerse to grow earnings in the years to come,” DZ Bank AG analyst Matthias Duerr said in a note to clients today. “Together, with the 50 million euro cost savings announced in February 2010, total cost savings of 150 million euros will be realized in 2013.” He has a “buy” recommendation on the stock.

A bit surprised Warsaw didn’t get the nod, seeing as it tends to be seen as CEE’s future financial center. It just remains to see which office developer (or owner) wins the tug of war for the prestigious tenant.

Orco responds

This now up on Orco’s website:
The Orco Property Group board of directors has learned of a press release issued by a group of shareholders claiming to hold over 10% of the company’s voting rights and represented by Jean-Pierre Mattei, “former president of the Paris commercial court”.
The board has given the task to two of its independent directors – Alexis Raymond Juan and Robert Couke – to review the shareholders involved in this group and its intentions. The board will communicate with the release of the Group annual results.

Interview with JP Mattei

Patria.cz is carrying an interview with Jean-Pierre Mattei, who’s leading the charge against Orco’s current board of directors. There’s not so much that’s new in it, but the tone is definitely not one of compromise.

Patria.cz: Could you please specify more the share of the voting rights in Orco Property Group which the group of shareholders You represent has available?

We stated that we represent 10% since this is the threshold for calling a General Assembly. We won’t go into further details than this but can tell you that we represent a combination of longtime shareholders and some newer investors (family offices, investors etc) that share similar concerns over the need for the company to address its debt issues. Addressing the debt issue is clearly all shareholder s’ interest.

Patria.cz: Is Millenius Investments, which reportedly holds 7.74% in Orco, among the participants in Your association?

Yes, Millenius is one of a number of shareholders seeking the appointment of a new Board.

Patria.cz: If the current management of the company stays, what is at stake for Orco?

So far the CEO has failed to address the debt issue and what is really at stake is Orco’s debt reduction and therefore its capacity to survive. The final objective of our initiative is to create value for all the shareholders.

Full interview here.

Jean-Pierre Mattei calls for JF Ott’s ouster

Can’t tell yet if this is related to the Millenius announcement yesterday, but BusinessWeek has just run a Bloomberg story that claims that a grouping of shareholders is calling for JF Ott to be removed as CEO of Orco, along with the rest of the board.

Luxembourg-based Orco has 30 days to hold the meeting, said Jean-Pierre Mattei, representing shareholders who control more than 10 percent of voting rights. He called for other holders to join in the effort to shake up the company’s management, according to an e-mailed statement released today in Prague…

“We have lost confidence in the chairman and CEO,” Mattei, a former president of the Paris Commercial Court, said in the statement. “After a full year under French ‘safeguard’ court protection, he has failed to cut down the debt burden that has been paralyzing the company and ruins any hope of a rebound for Orco.”

Follow the link to read the whole story. Isn’t there a warrant holders meeting going on today?

Update: Reuters is reporting the shareholders group would put forward Mattei’s name to take Ott’s place. It’s being reported that the proposed new board members would include Jean-Pierre Mattei, Anne-Marie de Chalambert, Jean Coeroli, Emile Ferenczy, Jean Van Den Esch a Patrick Aubart.

PropertyEU has a longer quote from Mattei, which includes: ‘The new board’s top priority will be to slash the consolidated debt by at least 25%, the company’s survival depends on it. The company needs breathing space in order to invest and grow, on the basis of a healthy, profitable and sustainable business model.”