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UPDATE 2-Poland launches $130 mln Lotos placement

Published 01/21/2010, 06:29 AM
Updated 01/21/2010, 06:33 AM
EUR/PLN
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HG
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* Bookbuilding started on Thursday

* To close by 1000 GMT on Friday

* Shares fall 1.5 percent

(Adds analyst, updates share price)

By Maciej Onoszko and Chris Borowski

WARSAW, Jan 21 (Reuters) - Poland launched a placement of at least 10 percent of the country's No. 2 refiner Lotos worth $130 million on Thursday as part of a privatisation drive to help plug a budget hole, fund managers told Reuters.

"Today we'll have bookbuilding for between 10 and 13 percent of Lotos," a fund manager who asked not to be named said, adding he expects it to close Friday by 1000 GMT.

Shares in Lotos, one of Warsaw's star performers last year with a 166 percent gain, fell 2.59 percent to 31.24 zlotys ($11.06) at 1126 GMT, to value the company at about $1.23 billion. Another fund manager said Poland's treasury ministry was aiming to sell 11 percent of Lotos, in which it holds a 64 percent stake. Poland wants to retain a majority stake in the refiner.

"It's difficult to deny this, but we'll have to wait until the end of the placement," Deputy Treasury Minister Mikolaj Budzanowski told reporters.

Poland should have little trouble unloading the shares after an oversubscribed placement of a 10 percent stake in Europe's No. 2 copper miner KGHM two weeks ago, which yielded some $720 million, analysts said.

"Lotos is our top play in the sector. We don't expect the transaction price to be much lower than the market valuation," said Pawel Burzynski, an analyst at BZ WBK in Warsaw.

Poland aims to raise at least $9 billion from selling state assets this year, including large flotations of insurer PZU and utility Tauron, to help fund its mounting budget deficit, which is expected to reach 52.2 billion zlotys this year.

It will also continue to sell minority stakes on the market, including holdings in energy groups PGE and Enea.

On Wednesday, Enea's chief executive told Reuters Poland could sell up to 16 percent of the company.

The steady trickle of deals is also expected to support the Polish zloty thanks to expectations that foreign buyers will continue to convert foreign currency on the market.

"Any positive news coming from Treasury that the ministry is able to sell it's stake in state-controlled companies is good," one dealer in Warsaw said. "EURPLN (Euro-Polish zloty) is offered and as soon as the euro firms against the dollar, the zloty should go up as well." (Additional reporting by Piotr Bujnicki and Dagmara Leszkowicz; Editing by Will Waterman and Sharon Lindores) ($1=2.825 Zloty)

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