PPF (company)

PPF Group N.V. is a privately held international financial and investment group founded in 1991 in Czechoslovakia and residing in the Netherlands. PPF Group invests in multiple market segments such as financial services, telecommunications, biotechnology, real estate and mechanical engineering. The reach of PPF Group spans from Europe to North America and across Asia. It is active in the Czech Republic, Slovakia, Serbia, Hungary, Montenegro, Netherlands, Bulgaria, Croatia, Poland, Romania, Slovenia, Russia, Kazakhstan, Finland, Germany, India, Indonesia, Vietnam, Philippines, China, France, United Kingdom and the USA. The founder and majority shareholder, Petr Kellner (98.93%), is also estimated to be the wealthiest person in Czech Republic,[5] according to the Forbes magazine.[6] The other two shareholders, Ladislav Bartoníček and Jean-Pascal Duvieusart, each hold a 0.535% share.

PPF Group
TypeN.V.[1]
Founded1991 (1991)[2]
FounderPetr Kellner
Headquarters
Amsterdam
,
Netherlands
Key people
Petr Kellner (Founder and Majority Shareholder)[1]
Ladislav Bartoníček (shareholder)
Jean-Pascal Duvieusart (shareholder)
Revenue€8,638 billion (2018)[3]
€1005 million (2019)[3]
Total assets€48.6 billion (2019)[3]
Total equity€8.8 billion (2019)[3]
OwnerPetr Kellner (98.93%)
Number of employees
158,000 (2018)[3]
Subsidiaries
Websitewww.ppf.eu
Footnotes / references
[4]

As of 31 December 2019, PPF Group's assets of the worth of 48.6 billion euros.[7][8]

History

The history of PPF dates back to the early 1990s. After the Velvet Revolution in Czechoslovakia, the government led by Marián Čalfa decided to gradually privatize state-owned companies. The legal framework was set by Act No. 92/1991 enacted on 26 February 1991. One of the agreed privatization methods was voucher privatization. Czechoslovak citizens who decided to take part in the voucher privatization had two options, either bid for shares in the privatized companies by themselves or exchange in advance their vouchers for shares in privatization funds, whose managers would make the investment decisions by themselves.

In September 1991 Teplice-based company Správa prvního privatizačního fondu (literally Management of the First Privatization Fund) was founded, its registered capital was only CSK 100,000 (US$3,300).[9][10] Petr Kellner became its chairman, other board members were managing director Milan Vinkler and Petr Joudal.[9] All of them were already entrepreneurs. In February 1991 Kellner founded company ANO with Joudal[11] and company WIKA with Vinkler.[12]

To succeed in the privatization, PPF needed money for an advertising campaign. It obtained the capital from state-owned glassworks Sklo Union, which was also based in Teplice. Štěpán Popovič, board member of Sklo Union,[13] formally introduced Kellner to the board, which in turn approved a CSK 20 million investment in the form of capital increase and debt financing.[14][15] In November 1991 registered capital of PPF was increased to CSK 6.6 million (US$226,000) and Joudal was replaced by Jaroslav Přerost, who was at the time CFO of Sklo Union.[9][13][16]

In December 1991 PPF set up five investment funds:[17]

Name of the fundRegistered officeBoard members (chairman first)
First Bohemian Privatization Fund TeplicePřemysl Voráč, Petr Joudal, Ladislav Bartoníček
First Moravian-Silesian Privatization Fund ZlínPetr Kellner, Radomír Zbožínek, Jiří Cajthaml
First North-Bohemian Privatization Fund TeplicePetr Kellner, Milan Vinkler, Vladimír Klebsa
First South-Bohemian Privatization Fund České BudějoviceVladimír Sochor, Radomír Zbožínek, Milan Skoumal
Regional Investment Fund LiberecJiří Drda, Ladislav Bartoníček, Milan Vinkler

Registered capital of each fund was CSK 100,000 (~US$3,300).[17] PPF did not establish any fund focused on Slovakia.

1992–2000

In March 1992 registered name of the management company was shortened to První privatizační fond (First Privatization Fund), a month later extraordinary general meeting elected Popovič to its board.[9]

Following the advertising campaign at the outset of the first wave of voucher privatization, PPF funds gathered 1.4% of all investment points and PPF became eleventh-largest management company in terms of acquired privatization points.[18] In the second wave that took place after dissolution of Czechoslovakia PPF funds gathered 2.1% of all investment points (ninth-largest group).[18]

In 1994 shareholders of the four largest funds from the first wave agreed a merger, the smallest Regional Investment Fund was later liquidated.[17] In 1996 the merged fund acquired 20% stake in Česká pojišťovna (ČP), the largest Czech insurance company. ČP had a profitable insurance business, however its two subsidiary banks were losing billions of Czech crowns, decreasing the ownership equity of ČP.

On 17 June 1996 the first wave fund was transformed to a standard holding corporation (PPF IH). The transformation took place just two weeks before 1 July 1996, when the Act No. 142/1996 made the transition to a standard corporation much more complicated.[19] As a result, PPF IH was not subject to regulation of investment funds anymore. To push the transformation through, PPF used cross-shareholdings. For example, industrial company TMP where PPF was the largest shareholder acquired in March 1996 shares of the fund, only to sell them for a lower price after the extraordinary general meeting losing CZK 96 million (~US$2.5 million).[20]

On 19 June 1996 the Minister of Finance Ivan Kočárník hosted a key meeting of ČP shareholders (NPF, PPF, IPB, ČSOB and KB). National Property Fund (30% stake) was represented by Minister of Privatization Roman Češka (ODA), governor of the Czech National Bank Josef Tošovský was also present. It was agreed that PPF should manage ČP and IPB its ailing subsidiary banks. PPF and IPB also got an option to purchase ČSOB shares, subject to condition that audited ČP profit for calendar year 1997 is positive. In 1998 PPF and IPB exercised the option and the state lost majority in ČP (the state was the largest shareholder of ČSOB and KB).

On 21 March 2000, Libor Procházka (IPB) agreed with Petr Kellner to sell ČP shares controlled by IPB to Dutch-based company CESPO. The contractual penalty amounted to 75% of the purchase price (CZK 1.6 billion). IPB transferred the shares too late and therefore CESPO paid only 25% of the agreed price. As a result, PPF had a majority interest in ČP.[21] IPB went into forced administration in June 2000 and was sold to ČSOB. ČSOB later took PPF to the court, claiming the price of ČP shares was too low,[22] however it lost the case.

In September 2000 registered capital of PPF IH was decreased by 90% and CZK 1.77 billion (~US$45 million) was distributed among its shareholders (CZK 500 per share, meaning CZK 15,000 per voucher book).[17]

2000–present

Jiří Šmejc became a shareholder of PPF Group N.V., registered in the Netherlands in 2005, acquiring a 5% share, with Ladislav Bartoníček and Jean-Pascal Duvieusart later becoming the remaining two shareholders.[23]

PPF Group bought TV Nova, the first private TV station in the Czech Republic, in 2002. Then in 2005, after stabilizing it, the group successfully sold TV Nova to the media group CME before agreeing with CME to buy the station back in 2019.[24]

In 2008, PPF Group and Italian Generali founded an insurance holding, into which they deposited their insurance assets. As of 2013, the Group owned assets worth 22.113 billion euros, including various assets from banking and insurance to real estate, energy, agriculture and the biggest Russian electronics consumer chain Eldorado.

Along with J&T and Daniel Křetínský, PPF Group founded EPH in 2009 (Energetický a průmyslový holding - Energy and Industrial Holding), which allowed them to access the energy and industry sector. PPF Group has 40% share in company. In August 2012 PPF Group converted part of its debt for EPH shares and increase its share to 44.4%.[25] In June 2014 PPF Group sold its stake for 1.1 EUR billions.[26][27]

In 2011, along with another Czech billionaire Karel Komárek (KKCG), the group took control over the Czech lottery company Sazka. Working together, both companies were able to stabilize Sazka and help it to recover. In October 2012, PPF Group move on to sell their 50% share to KKCG.[28]

PPF Group also founded a new bank in 2011 - Air Bank, specializing in online banking. Then, towards the end of 2012, Sotio became a member of PPF Group. SOTIO is a biotechnology company developing a new Active Cellular Immunotherapy ("ACI") for the treatment of cancer and autoimmune diseases.[29]

Jiří Šmejc sold his 5% share in PPF Group to Petr Kellner in 2013. In exchange he acquired a 13,4% share in Home Credit N.V. and Air Bank.[30]

In November 2013, PPF Group acquired a 66% share in the Czech telecommunications company Telefónica O2 Czech Republic for 63,6 billion CZK (~US$3.2 billion). In August 2015 the general shareholders meeting authorized the division of the company into O2 – a mobile service provider, and CETIN - telecommunications infrastructure and network company.[31]

In March 2018, PPF Group has agreed to buy Telenor's operations in Southeast Europe, namely Bulgaria (Telenor Bulgaria), Hungary (Telenor Hungary, Telenor Common Operation), Montenegro (Telenor Montenegro) and Serbia (Telenor Serbia) for a sum of 2.8 billion euros.[32]

In September 2019, PPF Group acquired a 19.2% stake in biopharmaceutical firm Autolus Therapeutics, making it the company's biggest shareholder.[33] In October 2019, AT&T agreed to sell its stake in broadcasting company Central European Media Enterprises to PPF.[34]

See also
  • Emma Capital, an investment management company founded by PPF former shareholder Jiří Šmejc

References
  1. http://www.ppf.cz/en/?sec=512
  2. http://www.ppf.cz/en/about-us/ppf-groups-history.html
  3. "PPF Group Annual Report 2017" (PDF). ppf.eu. Retrieved 13 December 2018.
  4. PPF GROUP N.V. Annual Report 2015
  5. "70 nejbohatších a 10 nejštědřejších Čechů roku 2017 | Forbes". Forbes CZ (in Czech). Retrieved 2017-10-31.
  6. s.r.o., PTV Media. "Kellner still richest Czech | Prague TV - Living Like a Local!". prague.tv. Retrieved 2017-10-03.
  7. "PPF Group N.V. reports its audited consolidated financial results as at 31". www.ppf.eu. Retrieved 2020-06-17.
  8. Miler, Marek (2020-06-03). "Pro Kellnerovu PPF byl loňský rok jeden z nejziskovějších". Hospodářské noviny (iHNed.cz) (in Czech). Retrieved 2020-06-17.
  9. Commercial register at justice.cz, identification number (IČ) 43222277, Správa prvního privatizačního fondu, a.s. / První privatizační fond a.s. / P P F investiční společnost, a.s. The company was liquidated in September 2004
  10. Recalculated into US dollars using exchange rate of Czech National Bank for September 6, 1991 (30.48)
  11. Commercial register at justice.cz, identification number (IČ) 15271153, articles of association signed on 12 February 1991, registered as ANO, spol. s r. o. on 5 March
  12. Commercial register at justice.cz, identification number (IČ) 14868423, articles of association signed on 28 February 1991
  13. Commercial register at justice.cz, identification number (IČ) 00012726
  14. Martin Jašminský, Nejbohatší z Čechů má rád Hamleta, Mladá fronta DNES, 2 July 2003
  15. Milan K. Osvaag, Štěpán Popovič: Vyberte si lidi chytřejší, než jste vy, Mladá fronta DNES, 16 July 2004
  16. Recalculated into US dollars using exchange rate of Czech National Bank for November 18, 1991 (29.23)
  17. Commercial register at justice.cz, identification numbers (IČ): První Český Privatizační Fond 44222424, První Moravskoslezský Privatizační Fond 44118899, První Severočeský Privatizační Fond 43222111, První jihočeský Privatizační Fond 14503107 and Regionální Investiční Fond 40232727
  18. Michal Mejstřík, The Privatization Process in East-Central Europe: Evolutionary Process of Czech Privatizations, Kluwer Academic Publishers, Norwell, Massachusetts, 1997, pages 158-161
  19. "Archived copy". Archived from the original on 2010-12-22. Retrieved 2010-12-27.CS1 maint: archived copy as title (link)
  20. Mojmír Hampl, Jan Macháček, Ni zisk, ni slávu, Respekt, 2. June 1997 ("Nabízí se samozřejmě otázka, k čemu může být podobná majetková míchanice dobrá. Šéfové PPF na ni odpovídají se zarážející upřímností: prostě prý zrovna potřebovali získat většinu hlasů na mimořádné valné hromadě zmíněného fondu, neboť tam chtěli odsouhlasit jeho přeměnu na holding.")
  21. Marek Jašminský, Hlavní slovo v České pojišťovně získala PPF, Mladá fronta DNES, 12 May 2000
  22. Pavla Nováková, Finanční giganti se střetnou o miliardy, Mladá fronta DNES, 12 June 2004
  23. "PPF Group's History". www.ppf.eu. Retrieved 2017-10-03.
  24. "PPF prodala TV NOVA americké CME za 642 mil.USD". kurzy.cz (in Czech). Retrieved 2017-10-03.
  25. "Kellner v srpnu zvýšil podíl v EPH na 44,4 procenta". TÝDEN.cz (in Czech). 2012-11-06. Retrieved 2018-03-21.
  26. MotejlekSkocdopole.com. "Kellner prodá svůj podíl v EPH, od Křetínského, Tkáče a J&T struktur dostane 30 miliard korun | MotejlekSkocdopole.com". Retrieved 2018-03-21.
  27. "PPF prodá svůj podíl v EPH. Holding ovládnou Tkáč a Křetínský | Firmy a trhy". Lidovky.cz (in Czech). 2014-06-19. Retrieved 2018-03-21.
  28. "Miliardář Komárek se stal vlastníkem celé Sazky, vyplatil Kellnerovu PPF". Novinky.cz (in Czech). Retrieved 2017-10-03.
  29. "The company - About us | Sotio a.s." www.sotio.com. Retrieved 2017-10-03.
  30. MotejlekSkocdopole.com. "Jiří Šmejc se zřejmě stal dolarovým miliardářem | MotejlekSkocdopole.com". Retrieved 2017-10-03.
  31. Pospíšil, Aleš. "O2 je na dvě půlky, infrastrukturu má Cetin". MobilMania.cz (in Czech). Retrieved 2017-10-03.
  32. "Norway's Telenor exits central Europe with $3.4 billion asset sale to Czech investor PPF". Reuters. 2018-03-21. Retrieved 2018-03-21.
  33. "Czech billionaire Kellner's PPF Group expands in biotech with..." Reuters. 2019-09-16. Retrieved 2019-09-17.
  34. Ramos, Dino-Ray (2019-10-27). "AT&T Sells Central European Media Enterprises For $1.1 Billion To Czech Investment Firm To Pay Down Debt". Deadline. Retrieved 2019-12-20.
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