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Penta to withdraw to minority

THE PENTA investment group which is buying into Petit Press publishing house through the company Namav has agreed to withdraw to a 45-percent minority share and thus leave the controlling 55-percent package to the Prvá Slovenská Investičná Skupina (PSIS), the original founder of the publishing house. Penta, which originally was set to buy a 50-percent stake in Petit Press, the publisher of flagship newspaper daily Sme, is to sell a 5-percent share to PSIS and according to Petit Press CEO Alexej Fulmek, the financial group will have no influence over editorial content in the publishing house.

THE PENTA investment group which is buying into Petit Press publishing house through the company Namav has agreed to withdraw to a 45-percent minority share and thus leave the controlling 55-percent package to the Prvá Slovenská Investičná Skupina (PSIS), the original founder of the publishing house. Penta, which originally was set to buy a 50-percent stake in Petit Press, the publisher of flagship newspaper daily Sme, is to sell a 5-percent share to PSIS and according to Petit Press CEO Alexej Fulmek, the financial group will have no influence over editorial content in the publishing house.

“For three years, they are only entitled to information on how the company is doing,” Fulmek said in an interview with Sme on November 6, adding that “they of course also have the right to have their two members sitting at the sessions of the supervisory board”, but without a right to veto. “We will accept them as a 45-percent partner, but they will not have any other rights.”

The information on Penta’s plans to enter Petit Press in early October spurred resignations by editors at Sme. Matúš Kostolný, the editor-in-chief of Sme, and his four deputies submitted their resignations, arguing that the presence of Penta, a controversial financial group, will prevent them from doing their work freely. Fulmek said he would stay in the publishing house only so long as he is able to guarantee editorial freedom.

When asked by the Sme reporter on what influence Penta might have over the first three years on Sme, Fulmek responded: “None, neither in the first three nor after”.

Petit Press also publishes, along with Sme, the Hungarian-language daily Új Szó, eastern Slovakia’s Korzár daily and a network of local newspapers. Petit Press also owns a 75 percent share of The Slovak Spectator.

Nevertheless, the sale of shares to Penta has been troubled from its early stages. While Rheinisch–Bergische Verlagsgesellschaft (RBVG) announced on October 14 that it is selling its share package to a company represented by the SITA newswire because PSIS did not exercise its pre-emptive right to buy shares in line with the Slovak law, PSIS claims it attempted to buy shares in what was a legitimate use of that right.

PSIS, represented by Peter Vajda, a subsidiary of Czech investment holding Proxy-Finance, initially offered to buy 10 percent of the shares, which the German shareholder considered insufficient and opted for continuing with the transaction, which is to result in the sale of shares to a firm financed by Penta.

Meanwhile, a group of reporters who left Sme has already published the first details of their new project, which is to be called Projekt N and could launch in November.

Concerns

The negative response to Penta’s entry to the publishing house are reinforced by the fact that Penta was mentioned extensively in the infamous Gorilla file, an unverified transcript purporting to originate from conversations covertly recorded by the country’s SIS intelligence service between 2005 and 2006.

Key Penta shareholder Jaroslav Haščák’s name is featured in the Gorilla file in association with conversations he is alleged to have had with senior officials and politicians from the ruling coalition in 2005 and 2006, mainly about privatisation and the provisions from the sale of state property. Penta has denied Haščák’s involvement.

The Gorilla file also mentions the name of one of the owners of SITA, Igor Grošaft, who allegedly participated in representing Penta’s interests in talks with politicians.

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