POLAND - Dutch insurance company Eureko decided this week to withdraw an application filed with Poland's insurance and pension regulator for permission to boost its stake in the Polish insurance giant PZU.
It’s the latest twist in Eureko’s six-year involvement with PZU, which has seen it file complaints against the government.
Eureko, which holds a 31% stake in PZU, plans to re-file the application to the regulator, known as KNUiFE, once the government sets a date for PZU's further privatization.
In 2003, Eureko filed a complaint against the government for international arbitration, saying the government, which currently holds 56% of the insurer, failed to deliver on its promise to sell a further 21% of PZU. Eureko wanted PLN1bn from the Polish state in the arbitration.
Last December, Eureko and the government agreed on a new deal that would allow to float some 20% of PZU on the Warsaw Stock Exchange by June 2005. In exchange, Eureko would release Poland from the previous contract.
The new deal is yet to be approved by the Parliament.
Eureko bought into PZU in 1999 when the State Treasury sold 30% of its shares in PZU to a consortium created by Eureko B.V. and the Polish bank - BIG Bank Gdanski SA.
One year later, the ownership structure of PZU was clarified as: 56% of its shares held by the State Treasury; 20% held by Eureko; 10% held by BIG BG Inwestycje SA, a subsidiary of BIG Bank Gdanski S.A.; and 14% held by PZU employees under the privatization scheme.
The PZU Group is the largest in the Polish insurance sector, with three main companies: PZU S.A., providing Non-Life insurance; PZU Zycie S.A., providing life insurance; and PTE PZU S.A., providing pension insurance. The Group has some 800 branches and provides services to 15 million clients throughout Poland.