On the back of continuous expansion of activities outside of the energy segment, the shareholders of Energetický a průmyslový holding, a.s. (EPH), EP Global Commerce, a.s. (EPGC), Czech Media Invest, a.s. (CMI), EC Investments, a.s. (ECI) and EP Real Estate (EPRE) are contemplating a series of transactions that will lead to the following:
1. EP Corporate Group has been established as an umbrella company which will own all strategic shareholdings of Daniel Křetínský and his top-management team, including EPH.
2. Current investments in large minority shareholdings in various listed companies will be newly held by the company EP Equity Investment (EPEI) which will own 100% in Vesa Equity Investment gradually; EPEI will be under control of Daniel Křetínský as majority shareholder, with Patrik Tkáč and Daniel Křetínský´s top-management team as co-shareholders in EPEI.
3. The final terms of the return of Patrik Tkáč to EPH are being negotiated between Daniel Křetínský and Patrik Tkáč.
A newly established holding company EP Corporate Group, a.s. (EPCG) will gradually acquire direct and indirect interests of Daniel Křetínský and EPH top-management in the aforementioned strategic companies, i.e. EPH (energy), EPGC (wholesale and cash & carry), CMI (media), ECI (e-commerce), EPRE (real estate). EP Corporate Group has already been established and is headquartered in the Czech Republic. EPH and all other current and future EP Corporate Group members will continue to implement ring-fencing, being financially separated and independent.
The current shares of EPH top-management in the group will be transformed in a 10.7% share in EPCG; the remaining 89,3% share associated with the management of the company will remain in the ownership of Daniel Křetínský. The EPCG board of directors will be identical to the current composition of the EPH board of directors.
EP Equity Investment Sàrl (EPEI) will obtain complete control over Vesa Equity Investment Sàrl gradually and thus indirectly also minority shareholdings in Royal Mail, Foot Locker, Casino Guichard-Perrachon and Sainsbury’s. In addition, it was agreed with other CMI shareholders that EPEI will also purchase ProSiebenSat.1 shares currently held by CMI. EPEI will be controlled by Daniel Křetínský and further co-owned by Patrik Tkáč and top-management of EPH.
At the same time, Daniel Křetínský is finalizing negotiations with Patrik Tkáč on the possible sale of 44% share in EPH to Patrik Tkáč. In the event of successful conclusion of these negotiations, EPCG would retain not only its majority shareholding of 56% in EPH, but also the full management control. As part of the transaction, all remaining liabilities of Daniel Křetínský´s companies arising from the original acquisition of Patrik Tkáč´s share in EPH will be settled.
As a result of the transaction, shareholdings of Daniel Křetínský and EPH top-management in EPEI and other co-investments with Patrik Tkáč, excluding CMI, are expected to increase to 56%.
In connection with the founding of EPCG, the previously announced acquisition of the football club AC Sparta Praha fotbal a.s., in which EPCG will also gain 56%, will be completed. The remaining 44% will remain in the ownership of investment structures close to J&T group shareholders.
EP Industries, which underwent changes to its ownership structure two years ago and where Daniel Křetínský is active as a financial investor without management control, is not affected by the changes and will remain outside the EPCG and EPEI structures.
“Establishment of EP Corporate Group and EP Equity Investment is a logical step that reflects the fact that an increasingly important part of our activities is realized outside the energy sector. In this situation, it is necessary to make it clear that EPH has been and will remain purely an energy utility and is not an entity that invests in other areas. At the same time, we are separating long-term strategic investments concentrated under EPCG from market positions in listed companies which are also primarily intended as long-term, however, we prefer retaining full flexibility regarding the investment horizon and the management of these market positions in general,” says Daniel Křetínský,chairman of the board of directors of EPH and the founder of EP Corporate Group and EP Equity Investment.
“As far as EPCG’s future strategy is concerned, we will focus on the development of existing segments. The key area, furthermore, managed directly by our core management team, will, of course, remain the energy sector. Nevertheless, with regards to the fact that the focus of future growth will probably be more in other segments, wholesale and retail including both offline and online activities could quickly become a pillar with a similar economic strength. We also anticipate development of investments in media. Our real estate activities will be focused mainly on developing our own sites released as a part of the development of other companies in the group, especially EPH. We will be closely monitoring growth opportunities in the sector of logistics, where we are already significantly active within EPH on one hand (vessels, rail and truck transportation of commodities) and e-commerce activities on the other.
EP Equity Investment will support the current strategy of Vesa Equity Investment based on identifying attractive investments in strategic minority positions, primarily in listed companies, with a preference for areas of EPCG’s activity, mainly retail, logistics and media,” added Křetínský.
“As for Patrik’s return to EPH, it is my initiative to which Patrik has responded positively.Given that since his departure from EPH we have always been developing other projects together, I consider it a logical step that EPH will not be excluded from the scope of joint activities and at the same time our shares in all joint activities will be gradually settled to the same level (56 vs 44%). This step will open the door for even stronger acquisition growth of the whole group,” concluded Daniel Křetínský.
“The current market situation together with long-term expansionary monetary policies of central banks are clearly in favour of investing in ownership interests, shares or permanent assets. We have always actively communicated about the investments made by Daniel Křetínský, and over the years we have known each other, Daniel has my absolute trust. Therefore, I find the return to the position of EPH shareholder to be a completely genuine and a very welcome step,” stated Patrik Tkáč.