Czech Republic

Creditors of troubled Czech hard coal miner New World Resources pushed on Sunday for a quick agreement with the government on state aid for its main operating subsidiary OKD to avoid its bankruptcy, saying a deal was needed next week. The firm's main creditors and shareholders acting under the name Ad Hoc Group (AHG) and holding 60 percent of equity and two thirds of NWR debt said on Sunday the firm, which has suffered from a fall in global coal prices, needed to secure financing from next month on.

Czech Industry and Trade Minister Jan Mladek offered last week that current owners sell 100 percent stake in the operating unit OKD of troubled miner New World Resources as well as most of the group's debt but majority owners and creditors rejected to name a price for the assets, Mladek said on Twitter, Reuters reported. The miner and its main creditors and owners, acting together under the name of Ad Hoc Group (AHG), have been seeking some form of government aid for NWR to avoid insolvency of the firm employing 13,000 people.

CSA Czech Airlines said that its key shareholder Korean Air Lines Ltd. has agreed to inject fresh capital into the country’s flagship carrier as it seeks to overcome its current financial struggles, The Wall Street Journal Emerging Europe blog reported. “The offered sum is within expectations of CSA laid out in the company’s restructuring plan,” CSA Czech Airlines’ spokesman Daniel Sabik told the Wall Street Journal Thursday, referring to the required maximum financing needs that in September were estimated at about $20 million.

The Czech central bank sees an “increasing” chance of a later exit from its unorthodox policy easing after it lowered its inflation forecast and maintained a cap on koruna gains. Policy makers in Prague left their benchmark interest rate at 0.05 percent today for a 12th meeting, matching the estimates of all 12 analysts in a Bloomberg survey. The bank also reaffirmed a commitment not to let the koruna “strengthen too much” beyond 27 per euro, a limit on the currency pair set on Nov. 7.

Czech trade minister Jan Mladek said on Monday loss-making coal miner New World Resources needed 3 billion crowns ($149.72 million) or more in new capital or it would face bankruptcy, Reuters reported. The Czech hard coal miner, which made a record fourth-quarter loss due to a sharp fall in coal prices, has been working on a capital restructuring since January. Its main shareholder BXR, which owns 63.6 percent, has said it is willing to invest new equity if there is a "revised and satisfactory" capital structure.

Czech wagon manufacturer Legios filed for insolvency on October 28, owing around CKr 220m ($US 11.7m) the VUB bank and more than CKr 300m to other creditors, IRJ reported. The company suspended payments of obligations in June 2013, but has reportedly been in financial difficulty since 2010, when police launched a criminal investigation into allegations of tax evasion. It is claimed that Legios made a false purchase of wagon components worth CKr 588m in order to claim a VAT rebate of CKr 111m from the state.

CSA Czech Airlines won European Union authorization to receive government restructuring aid after it sold assets, reduced capacity and gave up landing slots at European airports, Bloomberg Businessweek reported. The European Commission said it approved a 2.5 billion- koruna ($130 million) loan to the airline from state-owned company Osinek SA after Czech airlines agreed to a five-year restructuring plan that will also see it sell subsidiaries, aircraft and other assets and secure a private bank loan for an aircraft lease.

Private equity firm Penta Investments has made an offer for German insolvent drug store chain Schlecker, less than a month after buying a 40 percent stake in Polish retailer EM&F, Reuters reported. "We made a non-binding offer on Friday last week," a spokesman for Penta told Reuters on Friday, confirming a report in German weekly magazine Der Spiegel. He declined to provide details of the offer. Unlisted Schlecker, which competes with privately held peers Rossmann and dm, filed for insolvency in January after struggling to secure funds against a gloomy economic backdrop.

Lucchini group has sold its key foundry, Bari Fonderie Meridionali (BFM), to the Czech DT - Vyhybkarna a Strojirna AS, as part of Lucchini's debt restructuring plan, the Italian steelmaker said on Tuesday, Reuters reported. Lucchini, owned by Russia's Severstal and Severstal's owner Alexei Mordashov, reached a deal with shareholders and creditor banks in December, to restructure Lucchini's 720 million euro ($960.41 million) debt pile. The debt agreement is widely seen as paving the way for a potential sale of the debt-burdened Italian steelmaker to a third party.

The Czech Republic's fourth mobile network operator MobilKom has filed a petition to start insolvency proceedings, laying the blame for its woes squarely at the door of the regulator, the Czech Telecommunication Office (CTU), Telegeography.com reported yesterday. The company claims that the CTU repeatedly delayed its competitive entry into the GSM market and has reportedly initiated its own insolvency proceedings in the wake of its failure to adequately redress its poor credit history.