PZU SA, Poland's largest insurer, started an initial public offering that may top USD 2.7 billion in the country's biggest sale on record, according to Andrzej KLESYK, CEO, PZU quoted by BLOOMBERG.
PZU will take orders for the offering starting April 20 and plans to begin trading around May 14, according to a prospectus published on its Web site. The Polish government and Dutch investor EUREKO BV, selling a 30% stake, will announce the maximum price for individual investors the final price on April 29, when they complete the book-building.
"This is likely to be the biggest IPO ever in Poland," CEO Andrzej KLESYK told reporters, without giving specific figures. The company will have 555 meetings with institutional investors in the next two weeks, he said.
The IPO is part of the government's plan to raise a record USD10 billion from the sale of state assets this year to help finance the widening budget deficit. Poland also wants to sell stakes in its biggest energy, chemical and phone companies, as well as the Warsaw Stock Exchange. Warsaw-based PZU, which has 16 million customers or about half of adult Poles, controls 37 percent of the property insurance market. Its record net profit last year accounted for 97 percent of combined profit of all Polish insurers.
PZU plans to pay out 25 percent to 45 percent of annual consolidated profit as dividends, according to the prospectus. It also plans to pay an additional USD 326 million zloty as a dividend from 2009 earnings.
Poland and EUREKO set the minimum value for the entire company at USD 8.6 billion, or approximately USD 100 a share, in an October agreement that resolved an eight-year dispute over PZU's ownership and opened the door to an IPO. The insurer's two biggest owners earlier said they planned to sell at least 22 percent, valuing the holding at USD 1.9 billion.
