Yesterday’s Ceske radiokomunikace EGM did not bring any new substantial information regarding planned company restructuring; the board provided only general comments, noting that the board’s revision of company activities will be completed in May. In the meantime, Ceske radiokomunikace has spoken to selected investors to test potential interest in some of its subsidiaries. Tax optimization was cited as the only reason behind the recent incorporation of Ceske Radiokomunikace Limited on the Cayman Islands. The company said that it is not planning the sale of RadioMobil or of Contactel at the moment. Also, the company stated that an expert valuation had valued its 39% stake in RadioMobil at CZK 5.1 bil. (which is significantly below our estimate of CZK 23.5 bil., and, we believe, also below the market’s assessment of the stake’s value). The option on the RadioMobil stake purchase held by Ceske Radiokomunikace Limited is valued at CZK 2.2 bil. in Ceske radiokomunikace books.
It is not clear at the moment whether trading in the stock will resume today (at the moment it seems likely that it will remain suspended at least into early morning). We expect the stock to react negatively due to the above-mentioned valuation of the RadioMobil stake, and due to continuing uncertainty over the future of the company.
(Jiri Soustruznik)