Final Word from Tuesday, April 21, 2009

Small shareholders of Orco real-estate developer, who are already reeling from a 90% drop in the stock price, are now being caught up in the CR's fiercest proxy fight ever. An outfit calling itself SOS Orco has a big budget from unspecified sources and is trying to oust the current Orco management. There's the usual talk about shareholder protection and so on and so forth from the head of SOS Orco, Luboš Smrčka, but the real quarry seems to be Orco's lucrative land in Prague-Bubny. Politically connected predators have been circling around it since before Orco swooped in to buy it in 2006. If shareholders side with Smrčka in the proxy fight, they risk falling into a bear trap (or perhaps a Woolf trap). Smrčka has been involved as liquidator or trustee in more than half a dozen bankruptcies. Some of these, according to Týden, turned out suspiciously in the favor of real-estate magnate Radovan Vítek. Orco's small shareholders need to do some rudimentary due diligence on all involved before making up their minds.[Czech Republic James Flow East property]

Glossary of difficult words

proxy fight - a battle between two opposing groups, of which the management is usually one, over a matter to be addressed at a company's shareholder meeting;

to reel - to lose one's balance and stagger or lurch violently;

outfit - a group of people undertaking an activity together;

to oust - to drive out or expel;

quarry - a thing or person that is chased or sought;

to swoop in - to arrive on the scene suddenly and unexpectedly;

rudimentary - involving or limited to basic principles;

due diligence - reasonable steps taken in order to satisfy a legal requirement, esp. in buying or selling something.


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