PZAKY Powszechny Zaklad Ubezpieczen SA (PK)

By Martin M. Sobczyk

WARSAW--PZU SA (PZU.WA) Chief Executive Michal Krupinski said the Polish insurer's acquisition of a controlling stake in Bank Pekao SA (PEO.WA) should improve earnings a share by around 10% to 11% in the coming years.

The price that PZU, Poland's largest insurer, agreed to pay for a 32.8% stake in a $2.57 billion deal done jointly with Polish state investment fund PFR is attractive considering recent market trends, Mr. Krupinski said on Thursday.

PZU will buy 20% in Pekao and PFR will buy an additional 12.8% for 123 zlotys ($29.90) a share from Italy's Unicredit SpA (UCG.MI), which last sold a stake in Pekao in July at PLN126 a share.

Pekao was trading at PLN119.4 in morning trade in Warsaw, down 0.9%. PZU was 4.6% higher.

Unicredit said it will sell its remaining 7.3% stake on the open market. PFR said on Thursday Unicredit will likely hold on to the stake until 2019.

PZU will finance the takeover using its own cash and through the sale of liquid assets.

PZU also said it's not negotiating further large acquisitions at this point. Its banking unit, Alior Bank, said this week it ended talks to buy the Polish banking unit of Austria's Raiffeisen Bank International AG.

PZU expects closing of the Pekao acquisition in the beginning of the second quarter of 2017. It has no plan to immediately further boost its stake in Pekao, PZU's CEO said.

Write to Martin M. Sobczyk at martin.sobczyk@wsj.com

(END) Dow Jones Newswires

December 08, 2016 05:30 ET (10:30 GMT)

Powszechny Zaklad Ubezpi... (PK) (USOTC:PZAKY)
Historical Stock Chart
From May 2024 to Jun 2024

Powszechny Zaklad Ubezpi... (PK) (USOTC:PZAKY)
Historical Stock Chart
From Jun 2023 to Jun 2024