REUTERS SUMMIT-Polish insurer PZU interested in Croatian, Slovenian markets

Mon Sep 23, 2013 10:32am EDT

* Insurer may take part in Polish IPOs if profitable

* Plans to see through acquisitions in Croatia, Slovenia

* Predicts Polish debt markets will now stabilise

By Marcin Goclowski and Pawel Florkiewicz

WARSAW, Sept 23 (Reuters) - Central Europe's biggest insurer PZU is keen to buy stakes in companies in former Yugoslav countries such as Slovenia and Croatia, chief executive Andrzej Klesyk told a Reuters Investment Summit.

He said that PZU is still determined to buy a majority stake in the biggest Croatian insurance company, Croatia Osiguranje, as well as a stake in Slovenia's Triglav insurer, attracted by the combined market of 22 million people in these and other countries that used to form Yugoslavia.

"We're interested in acquisitions in this part of Europe, because no Western company has taken over this market yet. We want to consolidate it," Klesyk said, but added he saw no chance that the acquisitions would be completed this year.

PZU, which is controlled by the Polish state, could also be interested in taking part, as an investor, in the planned initial public offerings (IPOs) of Polish state-owned companies, Klesyk said.

Poland wants to sell a stake in power group Energa, which would likely be this year's largest IPO in Warsaw. The IPO of rail freight carrier PKP Cargo is also planned for this year.

"We will take part in every IPO on the Warsaw Stock Exchange, including the privatisation ones, if we see them as profitable for us," Klesyk said.

He predicted Poland's debt market would stabilise in the last quarter after turbulence on global markets and from a government plan to sideline private pension funds.

PZU is the biggest single domestic player on Poland's fixed income market, holding treasury bonds worth 36.2 billion zloty ($11.6 billion).

"As far as I understand, there will be no gigantic treasury debt issuance this year, which would require a big discount, while foreign investors still perceive Poland as a safe country," Klesyk said. "So I don't see any big moves on the treasury debt market until the end of the year."

The Polish government this month announced a plan to reform its state-guaranteed pension system by taking bonds held by private pensions funds, transferring them to the state, and then writing them off.

The plans were announced at a time when emerging markets globally were already anxious about how soon the U.S. Federal Reserve will start scaling back its bond purchases which are pumping cheap money into global markets.

At the beginning of September, Polish 10-year bond yields exceeded 5 percent, the highest level this year. Bond prices later pared their losses. (Editing by Ruth Pitchford; For other news from Reuters Russian and Eastern Europe Investment Summit, click here; Follow Reuters Summits on Twitter @Reuters_Summits; $1 = 3.1281 Polish zlotys)