The Cabinet somewhat surprisingly rejected a proposal by the Ministry of Finance yesterday that the state-owned Konsolidacni banka be allowed to bid up to CZK 1.4 bil. for a 49.25% stake in Aliachem. Aliachem is a highly indebted chemical holding, currently in bankruptcy proceedings, and is for sale. The only other bidder, Agrobohemie, is 50%-owned by Unipetrol, and is offering less (reportedly CZK 815 mil.). Following yesterday’s rejection, the ministries of finance and industry are to make a new proposal. Although no firm decision has been taken, there seems to be pressure in the Cabinet in support of Agrobohemie taking over Aliachem, as opposed to Konsolidacni banka. This, in our view, would not necessarily be positive for Unipetrol, since it would have to take on new debt and bear the cost of restructuring Aliachem.