Cabinet approves sale of 21% stake in PZU to Eureko

The Cabinet has approved the sale of an additional 21% stake in Poland's largest insurer, PZU, to international consortium Eureko. Eureko and its partner BIG Bank Gdanski (BIG BG) already own a 30% stake in PZU. Announcing the decision, Treasury Minister Aldona Kamela-Sowinska said that the sale of the additional package will take place within two weeks. The Ministry did not reveal the value of the transaction, but Rzeczpospolita reports that the Treasury may earn up to zl.3 billion from the sale. According to Kamel a-Sowinska, the price negotiations are about to begin. "A public offering is still possible, but it will be postponed until the end of 2002," she e xplained. After Eureko takes control of PZU the State Treasury will be left with only 34% of the company, as a 15% stake is owned by its employees. Although the Cabinet's decision has been criticized by leaders of the Democratic Left Alliance (SLD), market insiders think the future government is unlikely to overturn it, since doing so may instigate a conflict with the new investor. (Gazeta Wyborcza, p. 19; Rzeczpospolita, p. B5; Reuters) M.T.K.