Final Word from Wednesday, December 15, 2010

Everybody in Prague knows that Sazka lottery company is in play, and it's no secret that real-estate magnate Radovan Vítek is the one attempting the hostile takeover. Or is he? CEO Aleš Hušák of Sazka hinted that it might actually be Penta. He told Rádio Impuls that Penta's Fortuna betting company is trying to enter a new market (numbers lotteries) and can only succeed if Sazka is weakened or not on that market. And the entity buying up Sazka's debt is registered in Cyprus, he said, so we don't know who is behind it. Owners of Fortuna's 35% free float might want to start paying attention at this point. Can Fortuna afford an expensive takeover battle? Or would a mysterious Cyprus company sell them Sazka's gaming assets at a big markup? Fortuna stated the risk right there in its IPO prospectus: "Existing shareholders [Penta] will continue to exert significant influence on Management following the Offering."[Czech Republic initial public offering]

Glossary of difficult words

to be in play - to become a takeover target or to put oneself up for sale;

hostile takeover - a takeover that is resisted by the management of the target company;

free float - the amount of stock not under the control of stable shareholders and instead held by many shareholders in small parcels;

IPO - an initial public offering of shares in a company;

IPO prospectus - a formal written document which sets forth a plan for an initial public offering and which contains the facts an investor needs for making an informed decision;

Management - meaning in this case the management of Fortuna;

Offering - meaning in this case the IPO.


Tel: 420 224 221 580

Published by

E.S. Best s.r.o.
Ovenecká 78/33
170 00 Prague 7
Czech Republic



FS Final Word