Orco subscribed 420,051 shares of Croatian hotel complex Suncany Hvar for HRK 100 per share, i.e. total of EUR 5.7m and represents 47% of new issue of 885,161 shares. The rest was subscribed by Croatian Privatisation Fund and other entities. Orco thus maintained its 47% stake in Suncany Hvar.
Our view:
The price for which Orco subscribed new capital increase of Suncany Hvar is over 54% below Friday’s closing price. Orco thus immediately gained EUR 6.8m. Note that Orco still holds 2m warrants for Hvar’s shares with conversion ratio 1:1 at HRK 100 per share, giving company possibility to increase its stake to 60%. We see the news as positive, however market already had time to react on this news yesterday.