Elektrim to lose its head?
Wojciech Jańczyk expects he will probably be forced out of his post as president of embattled Elektrim following the company's extraordinary shareholders meeting on April 4.
While he anticipates his end is nigh, Jańczyk is urging the company and members of its complicated shareholder structure to list mobile operator Polska Telefonia Cyfrowa on the Warsaw Stock Exchange as soon as possible - to unlock its value and settle costly shareholder disputes out of court.
"I've done my sort of company-doctor thing," Jańczyk told the Business Journal, referring to the deal inked last year with bondholders that snatched Elektrim from insolvency.
Asked whether he would still be presiding over Elektrim through April, he said, "My guess, probably not."
Jańczyk also said that he expects to be asked to leave the company by Zygmunt Solorz, owner of cable TV operator Polsat which, along with holding company TCF, recently signed an agreement to purchase BRE Bank's roughly 30% stake in Elektrim by September. If the deal goes through, Polsat would be the largest shareholder.
Jańczyk and Solorz recently had a corporate dispute over the ownership of PTC, the country's largest mobile operator. At present, Elektrim Telekomunikacja and Vivendi hold 51% of PTC, while Deutsche Telekom owns the other 49%.
Earlier this month, Jańczyk approached global private equity investor Advent International with an investment deal that would allow Elektrim to increase its interests in PTC, but would effectively impede Solorz's plans to gain control over the same asset via Vivendi. Vivendi has announced its intention to sell its PTC stake. The specific details of the agreement were not revealed.
Jańczyk said he sought Advent's financial help in order to perform his duty as president of the management board to "represent the interests of all shareholders." Keeping control of the coveted and profitable PTC would be in the best interests of the company, he said.
However, Jańczyk is aware that he could have created a rift between himself and the new Elektrim investor.
"What I've done doesn't exactly warm his heart," he said. "When management of a company does something to stop an investor from taking action, (exercising) the right of first refusal, one cannot expect wonderful and tender feelings from him afterwards."
The management board recently called an extraordinary shareholders meeting for April, as a result of this corporate wrangling and, more importantly, the new ownership structure.
At the meeting Elektrim shareholders are expected to appoint new members to the supervisory board to reflect its new ownership structure, and specifically to represent Polsat and TCF. The shareholders are also expected to vote on downsizing the supervisory board from five to three members.
And Solarz will ascend to the supervisory board, at which time Jańczyk expects he might be asked for his resignation.
"It's interesting to see what will happen," he said. "I am awaiting April 4 with baited breath. I expect Solorz will take control."
Besides the dispute over PTC, Jańczyk said he could understand that a new supervisory board would want him out because his management style might not dovetail with the company's new direction. He explained that Elektrim has a "different objective."
Jańczyk said that he operates according to an investment banker style of management, ideal for saving foundering companies, as he did when he was hired by Elektrim's existing supervisory board about six months ago. Last October, as the company stood at the doorstep of the Warsaw bankruptcy court, he sealed a long-awaited E510 million debt-restructuring deal. The fruits of his work extended the company's much-debated bond payback deadline to 2005.
"I came in to save the company from bankruptcy," Jańczyk said.
However, he said that he has by no means relented from applying himself fully to the difficult tasks ahead for Elektrim.
"Today," Jańczyk said, "I am untangling the value of Elektrim Telekomunikacja and PTC."
He added that he would still like to hold a summit with PTC stakeholders, Deutsche Telekom, Vivendi and Elektrim, an intention he first revealed to the Business Journal last October. He explained that various complications have kept the trio apart.
For years, Deutsche Telekom and, indirectly, Vivendi have been filing court cases against the conglomerate over the ownership of PTC, which have created a stalemate in sorting out the desired changes in the future ownership of the company.
Whether he remains president or not after April 4, Jańczyk said that Elektrim needs to convene a summit. And, he said, the only probable solution to the dilemma is to list PTC on the Warsaw Stock Exchange as well as the London or New York stock exchanges, to unlock the value of the company and open several more avenues for setting ownership disputes.
Jańczyk is confident that if given the chance he could do the same as he did for Elektrim's bondholders. He is clear of some of the interests. "Vivendi wants the cash now," he said. "And why wait till 2005 (to pay bondholders) if you could sell PTC on the stock market?"
Investors starved for local stocks to buy would welcome PTC to the market, he said.
"It's so well known," Jańczyk said. "It had issue prospectuses in the past. We believe in an IPO for this company. We just need to unlock the stalemate. The arbitration helps nobody either. We would go definitely ... either this year or next."
Equity analysts agree with Jańczyk.
"This would be a very good idea for PTC," said Włodzimierz Giller, analyst at Erste Securities Polska. "It would be a blue chip, a couple of billion US dollar stock."
Giller said also that PTC could use another source of capital to pay down its roughly €970 million (zł. 4.2 billion) debt. And investors would look fondly on the name, especially because it is the number one operator in a country with a low 36% mobile penetration rate, he said.
PTC recently reported €80.1 million (zł. 347 million) in profit for 2002, 19% down from 2001, which was within Giller's expectations. Nevertheless, it recorded a 13.5% rise in sales.
While he anticipates his end is nigh, Jańczyk is urging the company and members of its complicated shareholder structure to list mobile operator Polska Telefonia Cyfrowa on the Warsaw Stock Exchange as soon as possible - to unlock its value and settle costly shareholder disputes out of court.
"I've done my sort of company-doctor thing," Jańczyk told the Business Journal, referring to the deal inked last year with bondholders that snatched Elektrim from insolvency.
Asked whether he would still be presiding over Elektrim through April, he said, "My guess, probably not."
Jańczyk also said that he expects to be asked to leave the company by Zygmunt Solorz, owner of cable TV operator Polsat which, along with holding company TCF, recently signed an agreement to purchase BRE Bank's roughly 30% stake in Elektrim by September. If the deal goes through, Polsat would be the largest shareholder.
Jańczyk and Solorz recently had a corporate dispute over the ownership of PTC, the country's largest mobile operator. At present, Elektrim Telekomunikacja and Vivendi hold 51% of PTC, while Deutsche Telekom owns the other 49%.
Earlier this month, Jańczyk approached global private equity investor Advent International with an investment deal that would allow Elektrim to increase its interests in PTC, but would effectively impede Solorz's plans to gain control over the same asset via Vivendi. Vivendi has announced its intention to sell its PTC stake. The specific details of the agreement were not revealed.
Jańczyk said he sought Advent's financial help in order to perform his duty as president of the management board to "represent the interests of all shareholders." Keeping control of the coveted and profitable PTC would be in the best interests of the company, he said.
However, Jańczyk is aware that he could have created a rift between himself and the new Elektrim investor.
"What I've done doesn't exactly warm his heart," he said. "When management of a company does something to stop an investor from taking action, (exercising) the right of first refusal, one cannot expect wonderful and tender feelings from him afterwards."
The management board recently called an extraordinary shareholders meeting for April, as a result of this corporate wrangling and, more importantly, the new ownership structure.
At the meeting Elektrim shareholders are expected to appoint new members to the supervisory board to reflect its new ownership structure, and specifically to represent Polsat and TCF. The shareholders are also expected to vote on downsizing the supervisory board from five to three members.
And Solarz will ascend to the supervisory board, at which time Jańczyk expects he might be asked for his resignation.
"It's interesting to see what will happen," he said. "I am awaiting April 4 with baited breath. I expect Solorz will take control."
Besides the dispute over PTC, Jańczyk said he could understand that a new supervisory board would want him out because his management style might not dovetail with the company's new direction. He explained that Elektrim has a "different objective."
Jańczyk said that he operates according to an investment banker style of management, ideal for saving foundering companies, as he did when he was hired by Elektrim's existing supervisory board about six months ago. Last October, as the company stood at the doorstep of the Warsaw bankruptcy court, he sealed a long-awaited E510 million debt-restructuring deal. The fruits of his work extended the company's much-debated bond payback deadline to 2005.
"I came in to save the company from bankruptcy," Jańczyk said.
However, he said that he has by no means relented from applying himself fully to the difficult tasks ahead for Elektrim.
"Today," Jańczyk said, "I am untangling the value of Elektrim Telekomunikacja and PTC."
He added that he would still like to hold a summit with PTC stakeholders, Deutsche Telekom, Vivendi and Elektrim, an intention he first revealed to the Business Journal last October. He explained that various complications have kept the trio apart.
For years, Deutsche Telekom and, indirectly, Vivendi have been filing court cases against the conglomerate over the ownership of PTC, which have created a stalemate in sorting out the desired changes in the future ownership of the company.
Whether he remains president or not after April 4, Jańczyk said that Elektrim needs to convene a summit. And, he said, the only probable solution to the dilemma is to list PTC on the Warsaw Stock Exchange as well as the London or New York stock exchanges, to unlock the value of the company and open several more avenues for setting ownership disputes.
Jańczyk is confident that if given the chance he could do the same as he did for Elektrim's bondholders. He is clear of some of the interests. "Vivendi wants the cash now," he said. "And why wait till 2005 (to pay bondholders) if you could sell PTC on the stock market?"
Investors starved for local stocks to buy would welcome PTC to the market, he said.
"It's so well known," Jańczyk said. "It had issue prospectuses in the past. We believe in an IPO for this company. We just need to unlock the stalemate. The arbitration helps nobody either. We would go definitely ... either this year or next."
Equity analysts agree with Jańczyk.
"This would be a very good idea for PTC," said Włodzimierz Giller, analyst at Erste Securities Polska. "It would be a blue chip, a couple of billion US dollar stock."
Giller said also that PTC could use another source of capital to pay down its roughly €970 million (zł. 4.2 billion) debt. And investors would look fondly on the name, especially because it is the number one operator in a country with a low 36% mobile penetration rate, he said.
PTC recently reported €80.1 million (zł. 347 million) in profit for 2002, 19% down from 2001, which was within Giller's expectations. Nevertheless, it recorded a 13.5% rise in sales.
