Generic selectors
Exact matches only
Search in title
Search in content
Post Type Selectors

HN: Prague wants to gain full control of strategic firms

Share on facebook
Share on twitter
Share on linkedin
Table of Contents

Prague, Nov 22 (CTK) – The Czech capital of Prague wants to gain full control of the firms which are of key importance to its functioning, daily Hospodarske noviny (HN) writes yesterday adding that it would need dozens of billions of crowns for this.
HN writes the purchases, if Prague goes ahead with them, will be the largest change in ownership in the capital since privatisation which followed the fall of the communist regime in 1989.
Prague wants to buy the firms supplying water and electric power, collecting wastes and others, HN writes.
“It would definitely be good for the city to own 100 percent of shares of strategic firms,” city councillor Karel Grabein Prochazka, who is responsible for the municipal property, told HN.
For the purpose, Prague plans to create a concern to be managed by an 11-member council. Later, the concern would be transformed into a holding led by managers, not politicians, HN writes.
It writes that out of the firms that Prochazka considers to be of key importance, Prague is a 100-percent owner of only two.
The Prague Water Supply and Sewerage company (PVK) has been owned by the French Veolia firm for 15 years.
In the past few years, it has made a profit of half a billion crowns after taxation on sales worth six billion crowns annually, HN writes.
The purchase of the firm would resolve Prague’s long-time trouble. The city owns the pipes which it leases to Veolia. But Prague complains that the lease is low and that it does not cover the costs of repairs and extension of the pipes, HN writes.
It writes that under the three previous mayors, Prague was trying to abolish or amend the contract with Veolia which is valid until 2028.
The negotiations have progressed most with billionaire Daniel Kretinsky about the wastes management in Prague.
Two thirds of the Prague energy company PRE are controlled by the German company Energie Baden-Wurttemberg, the rest is owned by Prague, HN writes.
PRE is also a very sound firm. With sales of almost 20 billion crowns, it had a profit of 2.5 billion crowns after taxation last year, HN writes.
However, the Germans have not made any offer for a possible purchase by Prague, HN writes.
Prague has enough money for purchases, Prochazka as well as Zdena Javornicka, head of the city financial department, told HN.
In the past two years, the city has had a budget surplus, it collects more in taxes than supposed, and it is not managing to fulfil its investment intentions, HN writes.
Last year, it had a surplus of 11 billion crowns. This year, the suplus will be lower, HN writes.
“If Prague decides to buy something in a couple of months, it will definitely have money for this,” Javornicka said.
($1=25.424 crowns)

most viewed

Subscribe Now