Prague, July 27 (CTK) – Former Czech PM Bohuslav Sobotka repeated on Friday that the sale of the state’s minority stake in the OKD mining firm to Karbon Invest in 2004 was in harmony with law and the competition rules, and said he was surprised by the new owners re-selling OKD to financial magnate Zdenek Bakala.

Sobotka (Social Democrats, CSSD), who was finance minister in 2002-2006, was talking to journalists before his questioning by a lower house commission enquiring into the suspicious OKD deal.

OKD ended up insolvent two years ago, and its successor company’s shares were later taken over by the state-run Prisko company.

Sobotka said Karbon Invest company owners Viktor Kolacek and Petr Otava indicated to no one that they did not plan to keep OKD, Sobotka said.

He said Kolacek and Otava had previously taken many-year efforts to gain a majority stake in OKD.

Sobotka pointed out that the privatisation of OKD started as early as at the beginning of the 1990s when dozens of thousands of miners’ flats were acquired by OKD.

However, 1996, when the state lost its majority stake in OKD, was a milestone. “The state distributed OKD shares for free until it lost a majority in the company,” Sobotka said, calling it absurd that criticism now targets the cabinet’s decision from 2004, which brought over four billion crowns of revenues from the sale of the minority stake.

The decision was made by a CSSD-led cabinet in which Sobotka was finance minister.

In 1996, a rightist cabinet of Vaclav Klaus ruled the country.

He said on Friday the state could no longer influence OKD at the time and that the selling of its minority stake to Karbon Invest was logical as Karbon Invest controlled OKD.

“I am convinced that…everything was in harmony with law and with the EU competition rules,” Sobotka, who was prime minister in 2014-2017 and who left high politics earlier this year, said, also defending the selling price of 4.1 billion crowns as higher than the price set by expert opinions.

In 2004, the state sold its minority stake in OKD for 4.1 billion crowns to the Karbon Invest company, which already owned the other part of OKD. The case was brought to court, with the plaintiff putting the stake’s real value at 9.8 billion crowns at least and saying the deal caused a 5.7 billion-crown damage to the state.

In early May, a court acquitted Rudolf Doucha, an expert who calculated the estimated price of the state stake. The court also acquitted Pavel Kuta and Jan Skurk, two former National Property Fund (FNM) officials in charge of the privatisation deal. The court said no evidence proved that their action amounted to crime. The state attorney appealed the acquittals, however.

Karbon Invest owners Kolacek and Otava kept OKD for two months before selling it to the Bakala-led RPG Industries financial group for a price that ranged from nine to 12 billion crowns, according to media.

Later OKD went to a firm owned by three British investment funds. Last year, it got insolvent and this April, its shares were acquired by Prisko.