Reurters agency reported that Unipetrol did not create provisions for possible a lawsuit with Deza. Deza is suing Unipetrol for damages after it broke the original contract about selling 39 % of Aliachem to Deza. Deza belongs to Agrofet group which signed a contract with PKN (63% in Unipetrol) about selling some assets. PKN refused the agreement as being unfavourable to it. The estimated penalty is about CZK 817m or CZK 4.50 per Unipetrol’s share. Note that Unipetrol reported audited consolidated FY05 net income at CZK 1,026m on Friday (-8% y/y). We see news as slightly negative and reiterate our Sell recommendation on Unipetrol and fair value CZK 261.3.