ZE PAK SA IPO exposes investors to major risks
Publisher: CEE Bankwatch Network
Volume: 4 pages, pdf
Description:
1. Analysts have already expressed concerns about “the company’s ageing assets, high capex needs and trailing financial margins”2. The political risks of investments in ZE PAK are significant given the government's objective of privatizing the company in 2012. The Treasury is under pressure to sell ZE PAK. To do that, we expect it will understate its risks before transferring them to private hands.3. ZE PAK already suffers financially from significant constrains on its coal supply. The company's proposed mine expansions face strong resistance both locally and from the Minister of Agriculture. An un-finalised EU Commission infringement procedure has found breaches of environment law at the Tomislawice mine.