Multi-Development, back by Morgan Stanley, won a tender to re-build a centre of Ostrava, former coking plant, for about cEUR490m despite Orco bidding together with Trigranit winning the public poll.
Recently, we have been expecting Orco/Trigranit not to win the Ostrava project while we are more optimistic on Orco's bid for a tender to re-build Prague 7, Bubny, which could according to our estimates bring EUR8share to Orco's valuation. The closing of the Bubny tender is not known yet.
Our view: Despite the Ostrava project could have added EUR6 to Orco's valuation, according to our estimates, we see the news as neutral given the relatively difficult re-building task (former coking plant) and Ostrava being characterized by high unemployment rates. We see higher potential in the Prague Bubny project, should Orco secure it.