Deputy Finance Minister Jan Mladek said yesterday that he favors limited guarantees for KB, the exact amount of which he said would be determined before binding bids are submitted in the first quarter of 2001 (there is no fixed deadline). He also suggested that the position of the four short-listed bidders is that guarantees are not necessary. Given the high expectations by some on the market of substantial government help to KB, such comments would usually be negative for KB, but they failed to make an impact on the stock yesterday, perhaps because its price was relatively low anyway.
Mladek also confirmed that legal opinions vary on the interpretation of the new commercial code, which seems to take away the government’s ability to exempt buyers of its stakes from mandatory buyout offers to minority shareholders. It seems that the government will seek to rush through Parliament an amendment to the code to preserve this ability. In the meantime, the four bidders for KB will likely make two offers, one assuming a buyout obligation and one assuming no such obligation.