Poland

PBG SA (PBG), Poland’s third-largest builder, decided to file for bankruptcy to help reach an agreement with creditors to cut debt by as much as 31 percent, Bloomberg Businessweek reported. PBG, which helped build three out of four stadiums for European soccer championship that kick off in Poland and Ukraine this week, is proposing to honor 69 percent of its debt to creditors owed more than 1 million zloty ($282,700), 80 percent to those owned from 100,000 zloty to 1 million zloty and 100 percent for those owned lesser sums, the company said in a regulatory filing today.

Polish builder PBG has extended a deadline on a debt restructuring deal with its lenders and broadened its scope to include its financing needs over the next year, it said on Monday, Reuters reported. The engineering and construction group is among several Polish builders to run into trouble on infrastructure deals with razor-thin margins in an ambitious road-building programme ahead of the Euro 2012 soccer games Poland will co-host this summer. "The process of negotiations on granting and launching bridge financing by banks has been prolonged," PBG said.

The Polish government has come up with a plan to plug its yawning budget gap by reducing the share of social security contributions it transfers to private pension funds. Poland’s move isn’t nearly as drastic as the measures taken in Hungary, but it met with fierce criticism nonetheless, The Wall Street Journal New Europe blog reported. In Poland, a fixed proportion of workers’ salaries is withheld as contribution to the country’s pension system. Most of that stays with the government and is used to pay out pensions to people already retired.

Poland’s central bank may start increasing interest rates in January as the zloty has lost its power to keep inflation in check, said Adam Glapinski, a member of the Monetary Policy Council, Bloomberg News reported today. The zloty weakened 2.3 percent against the euro in the six weeks through Dec. 22, when the policy makers left the central bank’s benchmark 7-day rate unchanged for the 18th month.

Deutsche Telekom AG and Vivendi SA Wednesday settled a years-long legal battle over Polish mobile-phone operator Polska Telefonia Cyfrowa, or PTC, giving the German company sole ownership and freeing up more cash for Vivendi to spend on buying out minority stakes in its domestic subsidiaries, Dow Jones Daily Bankruptcy Review reported. Under the settlement, Deutsche Telekom will pay another EUR1.4 billion ($1.9 billion) in total to Vivendi and Polish conglomerate Elektrim SA, which as a result of the payment will exit bankruptcy proceedings, giving Deutsche Tekekom 100% ownership.

General Motors Co. is considering putting more of its own money into the restructuring of its Opel unit in Europe in a bid to win €2.7 billion in state aid from European governments, people familiar with the situation have said, The Wall Street Journal reported. According to these people, who spoke in recent days, GM is open to increasing its share of the funding needed to turn around Adam Opel GmbH, the German-based unit that makes up the bulk of its operations in Europe.

Time is running out for German political leaders to provide financial help for General Motors Co.'s European Opel division—or risk the loss of more domestic jobs, The Wall Street Journal reported. Angered by GM's surprise move to abandon plans to sell Opel this month, German politicians have so far taken a belligerent stance and are threatening to withhold state aid altogether. Economics Minister Rainer Brüderle suggested this week that Opel may no longer qualify for aid regardless of what restructuring plan GM presents, a sentiment echoed by several other influential politicians.

A team of General Motors Co. executives will arrive in Germany on Monday to fine-tune a restructuring plan for Adam Opel GmbH and search out a new leader for the European unit, company officials said. The U.S. auto maker said Friday that Carl-Peter Forster, who worked for GM for more than nine years, is quitting as chief executive of GM Europe, The Wall Street Journal reported. The decision follows a vote by the company's board of directors on Tuesday to scrap a plan to sell control of the German Opel unit to Magna International Inc. and Russia's Sberbank.

Poland chose potential bidders for Warsaw Stock Exchange SA and announced plans to privatize strategic energy and mining companies in an effort to plug a gaping budget deficit, The Wall Street Journal reported. The move to sell government stakes in copper miner KGHM Polska Miedz SA and oil refinery Grupa Lotos SA took markets by surprise. Many analysts had been skeptical the government would carry through with such politically sensitive sales amid a recession.

The European Commission on Wednesday cleared the Polish government's state aid of €251 million ($356.4 million) to the Gdansk Shipyard, ending a long-running legal battle, The Wall Street Journal reported. The commission, the European Union's executive arm, has been investigating state subsidies for the historic shipyard, where the Solidarity trade-union movement was born, since 2004. Much of the state aid cleared by the commission has already been paid to the shipyard. The commission said in its ruling that the state subsidies gave the shipyard an unfair advantage over rivals.