Ministry unveils plan to privatize Polmoses
The privatization of the 18 remaining state-owned Polmos companies will be completed by the end of 2001, said Dariusz Wit vel Wilk, the managing director of Evip Corporate Management Consultants (Evip CMC), the privatization adviser to four of the Polmoses.
Last year, the Treasury Ministry said that the vodka-producing Polmoses would be sold off by the end of this year. That timeline is now impossible, as the ministry has released invitations for tenders to privatize only five of the Polmoses.
Nevertheless, the announcement that the sector's privatization would at last be carried out was good news for the liquor producers, which have seen domestic liquor sales plummet by 43% since 1994, according to the May 2000 issue of Rynki Alkoholowe.
"And the drop in consumption not only results in lower sales, but in a lower value for the Polmoses," Wit vel Wilk said.
The first five liquor producers to be privatized are located in Szczecin, Poznan, Lublin, Krakow and Zyrardow. According to the treasury's plan, the last ones scheduled for privatization are the Polmoses in Bialystok, Wroclaw and Zielona Gora.
Evip CMC, a management consulting company owned by Evip International, is keeping a close eye on the privatization process of the first four Polmoses.
"The privatization processes of the Polmoses in Krakow and Szczecin are quite advanced," Wit vel Wilk said. He added that their privatizations have taken a long time due to an extended pre-privatization process that ended two years ago.
According to the treasury, the next bids will be called by the end of September, and the last four tenders will be released at the beginning of the fourth quarter. Wojciech Bielecki, a ministry employee, said he couldn't reveal any further details about the ministry's schedule. "It will depend on the results from the negotiations with potential investors," he said.
Pawel Jagiello, president of Pro-Invest International, a management consulting company advising 10 of the Polmoses, said that there are several factors influencing investor interest. Not the least of them, he said, is the unresolved situation regarding trademarks registered abroad. The Polmos companies have been fighting for 10 years for the rights to register their products' trademarks internationally. Currently those rights belong to Agros Holding, an export company that originated under communism and is now owned by the French-based liquor producer Pernord Ricard.
"I wouldn't overestimate that problem," Jagiello said.
But potential investors see other obstacles to buying into the companies.
Evip CMC's Wit vel Wilk said that excise liquor taxes are still on the increase and will only be lowered once Poland joins the European Union. Moreover, the domestic market for alcoholic beverages is shrinking due to a drop in consumption and the increased amount of smuggled spirits, Wit vel Wilk said.
