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Corporate Briefs

VSŽ and Finance Ministry to agree on back taxes
French bank Paribas debates privatisation with Finance Min.
Steelmaker VSŽ meets over Hungarian DAM woes
EuroTel increased 1999 sales to 5 billion crowns
Antitrust Bureau approves Globtel GSM G1 service
American Molex to sign project deal in Slovakia
Rolls-Royce nixes cooperation with Slovak firm

VSŽ and Finance Ministry to agree on back taxes

Representatives of steelmaker VSŽ Košice met with the Finance Ministry and the Central Tax Office to discuss the conclusion of tax inspections at VSŽ on February 1. VSŽ President Gabriel Eichler said that the matter must be settled before the entrance of a strategic foreign investor.
Finance Minister Brigita Schmögnerová said the amount of back taxes accumulated by the eight main companies in the VSŽ group between 1996 and 1999 should be set within the next two weeks, and that the steel-maker should then pay its tax arrears according to an agreed-upon payment calendar.
VSŽ underwent restructuring at the beginning of the year and is currently preparing a deal with a foreign investor. During this process the strongest of the VSŽ subsidiaries, VSŽ Ocel, transformed from a limited liability company into a joint company wherein two other VSŽ affiliations merged - VSŽ Export-Import and VSŽ Ferroenergy.


French bank Paribas debates privatisation with Finance Min.

Finance Minister Brigita Schmögnerová met with Jacques de Larosiere, former International Monetary Fund (IMF) director and current advisor of BNP Paribas, on January 27 in Bratislava. At the meeting, Schmögnerová said the Slovak government wanted a quick and transparent privatization of the largest state-controlled banks: IRB (Investment and Development Bank), VÚB (General Credit Bank), and SLSP (Slovak Savings Bank).
The French guest said he appreciated the initiative of the Slovak government to implement principal reforms in the banking sector. Privatisation will contribute to the stabilisation of the Slovak economy and its preparedness for membership in the European Union, he said. Larosiere spoke about the Slovak bank privatisation project as an ambitious program that is highly attractive to foreign investors.


Steelmaker VSŽ meets over Hungarian DAM woes

The situation of Hungarian steelmaker DAM Diosgyor is being addressed on several levels, and representatives of VSŽ Košice were in Hungary to discuss the situation, VSŽ spokesman Jozef Marko said January 28.
VSŽ bought a 68.2% stake in the ailing Hungarian steelmaker at the beginning of 1998 for a symbolic one dollar. In return, VSŽ pledged to increase DAM's share of equity by 3 billion forints in 1998 and by 1.5 billion forints in 1999. However, the settlement of VSŽ's obligations was postponed because of its bad financial situation.
DAM's electricity was recently cut off when its supplier demanded overdue invoices of 700 million forints. The power supply will be restored when DAM guarantees the settlement of its arrears.


EuroTel increased 1999 sales to 5 billion crowns

Mobile phone operator EuroTel Bratislava estimated its total 1999 sales at approximately 5 billion crowns, to be confirmed after its financial audit, said EuroTel spokesperson Katarína Lepiešová on January 28.
EuroTel Bratislava, one of two mobile phone operators in Slovakia, operates networks of NMT, GSM 900 MHz, GSM 1800 MHz and the public data network. It covers 98% of the country's population with its signal and has more than 440,000 clients in Slovakia.


Antitrust Bureau approves Globtel GSM G1 service

The Antitrust Bureau ruled in favour of mobile telephony operator Globtel GSM on January 27 when it declared that Globtel's G1 service did not violate the monopoly status over voice communication currently enjoyed by the state-run Slovenské Telekomunikácie (ST).
"The strengthening of the competitive environment by providing a new service is in accordance with the rules of protecting economic competition," said Imrich Zwieb, head of the Antitrust Bureau.
Globtel GSM re-introduced its G1 service on January 21, enabling clients to make cheap calls abroad via the Internet, and arguing that the service is therefore not a voice service but a data service.
The bureau said that only Globtel GSM has applied for permission to provide such a service at the Telecom Ministry. Had other operators also applied for the service, the regulator would have acted in the same way. Therefore, no rules of equality in providing services on the relevant market were violated, the bureau said.


American Molex to sign project deal in Slovakia

Štefan Šulek, the director of project design company Hutný Projekt Košice, told the Košice-based Top Radio on January 28 that the US firm Molex intended to sign a contract with his company to construct an electrical engineering plant in Kechnec (near Košice). According to company representatives, the signing should have taken place by February 3.
Šulek said that construction should start in April with completion set for December. The plant in Kechnec will be built similar to the Molex production unit in Ireland, which produces connectors for cell phones. The new plant in eastern Slovakia is expected to create 600 jobs in the first phase, and 1,200 in the second phase. The US company plans to invest $70 million into the project.


Rolls-Royce nixes cooperation with Slovak firm

Rolls Royce decided not to sign a contract on the certification of jet engines produced by Považské Strojárne Letecké Motory of northern Slovakia's Považská Bystrica (PSLM-engineering works). The letter of intent between the two firms expired on December 20, said Paul M. Kaye, Rolls-Royce's central European director on January 28.
Kaye said that high testing and licensing costs were the the main reasons Rolls Royce abandoned the agreement. However, the cloudy structure of PSLM shareholders also contributed to the decision. On October 8, 1999, Rolls-Royce and PSLM signed a letter of intent on exclusivity in the development of the DV-2S air engine. The two companies planned to sign a definitive contract in early 2000.


Compiled by Keith Miller from Reuters and SITA

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