According to Polish daily Rzeczpospolita, has bought a 25% stake in mutual fund company PKO TFI from . Depending on the source, the price ranges between PLN 120m and PLN 150m.
Our view:
has been planning to buyout for some time now. The price range equals between 5.7% and 7.2% of assets under management (AUM). This is higher than the speculated price of between 1.5%-3.0% of AUM and the latest market transaction between Opera TFI and TFI, when the price was set at some 2.5% of AUM, as well as various transactions before the crisis of around 4% of AUM. However the potential of PKO TFI is greater, with 10.12% market share as of July, while the bank retail deposit market share is 23% as of 1H09. Additionally, the new CEO of Zbigniew Jagiello comes from the leading mutual fund company Pioneer TFI. Moreover the transaction should provide some savings to the bank, as had paid a management fee to of PLN 14m in 1H08 and PLN 57m in 2008. We believe the news is slightly positive.