PGNiG's tempts its bond holders to cash in early

The most pressing of these obstacles is the need to transfer the ownership of its subsidiary, PGNiG Przesył, to the State Treasury. PGNiG recently announced it wants to buy back its bonds in order to be able to implement the transfer. In 2001 the company issued bonds worth EUR 679 million, which make up over a half of the company's debt of zł.4.2 billion. The bonds have to be bought back as otherwise it is likely that the bond holders would not consent to such a large reduction in PGNiG's assets. The deadline to buy back the bonds is 2006 and it is not sure whether all of their owners would like to sell them earlier. All indicators are that the company would have to pay much more than the bonds are actually worth. According to PGNiG's representatives, the company would have to earmark EUR 107 million for that purpose. Moreover, "We plan to grant every bond holder a EUR 5 bonus for each tranch of bonds they sell with of a nominal value of EUR 1,000," said Marek Kossowski, PGNiG president. The final decision will be made during bond holders' meeting on March 29. (Puls Biznesu, pp. 1, 6) D.W.