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Orco shareholders approve plans to reduce share capital
May 29, 2014 / 9:36 AM / 3 years ago

Orco shareholders approve plans to reduce share capital

PRAGUE, May 29 (Reuters) - Shareholders in Orco Property Group have approved a plan to reduce its share capital and given the company authorisation to issue more shares if needed, the central European real estate developer said.

An extraordinary general meeting on Wednesday agreed to cut the nominal value of its shares to 0.10 euros from 1.00 euro, reducing the registered capital to 11.45 million euros.

Shareholders at Wednesday’s meeting also backed the authorisation to issue up to 200 million new shares, Orco said.

The capital reduction follows a previous cut by half in April. J&T Banka analyst Pavel Ryska said the latest cut brings the nominal value of the shares below the market price, making it easier to issue new stock in the future.

Orco’s shares traded at 0.58 euros in Paris on Thursday and have fallen sharply since peaking at 133.90 in 2007 as it struggles to recover from the global financial crisis, which had pushed it into a debt restructuring.

The company posted a record loss last year after write-offs, mostly due to provisions for its unfinished 192-metre high Zlota 44 residential tower in Warsaw.

In April a bank called in loans on the project. Orco has put up for sale the landmark building, which stands near Warsaw’s tallest structure, the Palace of Culture and Science.

Orco’s largest shareholder, Czech real estate investor Radovan Vitek, has built up a 30.7 percent stake in the group in recent years.

In a separate statement, the company said it had also postponed its first-quarter results which had been expected on Wednesday until June 2, due to a delay in the results of GSG Group, in which Orco holds a stake. (Reporting by Jason Hovet; Editing by Greg Mahlich)

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