Penta Investments

Penta is a Central European investment group founded in 1994 in Slovakia.^[1] It pursues business in the private equity and real estate sectors, the largest portion of the value of its investments being in the Czech Republic, Slovakia and Poland. Penta invests mainly into the energy sector, retail, health care services, mechanical engineering and aircraft production. Penta is one of the biggest investment group operating in Central European region. In 2011 Penta achieved a consolidated net profit of EUR 127 mil.[1] In the end of 2011, Penta was dragging in Gorilla scandal, which appeared in Slovakia shortly before early parliamentary elections.

The name Penta is a tribute to the original five founding partners, all schoolmates during their studies in Moscow and Czechoslovakia.

History

Penta was founded by Czech Marek Dospiva and Slovaks Jaroslav Haščák, Martin Kúšik, Jozef Špirko and Jozef Oravkin. Penta's initial capital originated mostly from the business that the two founding members, Marek Dospiva and Jaroslav Haščák, conducted in China. In 1990, during their studies in Beijing, they founded a small textile importing company consisting only of two accountants and one secretary and began importing Chinese textiles to chain stores in Czechoslovakia. At the end of 1993, Penta Broker was founded and between 1994 and 1997 the company was an ordinary stock broker.

In 1996-1997, when the company's net asset value was approximately 50 million Slovak crowns, Penta gained control over VÚB Kupón - the largest investment fund in Slovakia, with an asset value of 9 billion Slovak crowns. Penta convinced the British Regents Fund to purchase a control block of stock of VÚB Kupón with an asset value of 9 billion Slovak crowns. During the transaction, VÚB, the founding bank of the fund, started to resist. The British Regents Fund decided to pull out of the transaction. At this key moment, Penta succeeded in convincing VÚB to sell its share and finance the purchase of stocks bought by the British fund. Penta gained control over VÚB Kupón for a stock price of only 20 percent of its real market value. VÚB Kupón's acquisition opened the way for Penta to earn its first billion. In 1999, Penta was restructured into a holding with its mother company in Cyprus. In the four years that followed, it realised several restructurings and investment transactions in Slovakia. These included VSŽ, Slovenská poisťovňa, Slovnaft, Elektrovod, Drôtovňa Hlohovec and Sanitas. In 2002, Penta's net asset value was 2 billion Slovak crowns.

In 2001, Penta entered the Czech market with the development of its Dr. Max chain of pharmacies, the acquisition and development of Aero Vodochody and the acquisition of SmVaK (North-Moravian sanitation Ostrava). In 2005, Penta has changed its structure to that of a standard private equity company and in the same year started investing also into real estate and expanding into other foreign markets beyond Slovakia and Czech Republic, primarily into Poland through the acquisition of Żabka, the country's largest independent food retail chain with more than 2000 stores, which was completed in the summer of 2007. In 2008 Penta made a major investment into the Hungarian meat industry.

In March 2006 Penta Investments Limited acquired MobilKom, a small telecommunication company with 10 employees.^[2] In the following months, MobilKom built wireless CDMA network in the Czech republic.^[3] Liabilities of MobilKom increased from CZK 4 million at the end of 2006 to CZK 2,116 million at the end of 2009, with China Development Bank among the largest creditors.^[4] In February 2011 Penta sold Mobilkom to the local wireless operator Divenno Holdings Limited. The company was not able to finance its mounting losses and in 2012 asked commercial court to allow restructuring.[8]

In 2005, Penta decided to diversify its portfolio. Apart from its buyout business, Penta decided to invest in real estate. The first move to this market was Bratislava Digital Park, an exclusive administrative complex, which has won prestigious architecture awards in Slovakia and abroad. In 2010 Penta invested into the first real estate project in Prague - Florentinum. Penta has started the construction of exclusive office space in down town Prague.

In recent years the group has succeeded in several major transactions, such as the sale of Zabka Polska, the business development and sale of TES Vsetín and restructuring of bankrupted steel wires manufacturer in Poland – Drumet. Recently, Penta has entered the new market Germany, through acquisition of traditional enginnering company Gehring Technologies.

Currently one of the most significant investment in Penta portfolio is EM&F Group. The company is listed on the Warsaw Stock Exchange and is a leading distributor of media and entertainment products, clothing, shoes, toys and accessories for children, cosmetics as well as language courses. The Group consists of operating and commercial companies and NFI Empik Media & Fashion S.A. as the holding company. EM&F business model is based on four segments: the Empik Group, the Smyk Group, Language Schools and Fashion and Beauty. The Group develops its business model based on own brands and trading concepts, as well as franchised and licensed brands. The EM&F Group companies have been successfully building their strong market position for years, have an extensive retail network and a large, stable customer base. EM&F operates in Poland, Russia, Ukraine, the Czech Republic, Slovakia, Germany, Romania and Turkey. In May 2012 Penta acquired a 33% stake from Eastbridge, the majority shareholder which along with Penta manages the Group.

In Autumn 2012 Penta announced the sale of its medical laboratories Alpha Medical. Penta had developed Alpha Medical from EUR 2 million sales in 2006 to current 65 million. Over the past five years, the Group acquisition-led growth strategy has seen revenues increase significantly. In this period, Alpha Medical has successfully entered two new countries and has established top five position in all three markets including market leadership in Slovakia and second position in the Czech Republic. The network reached significant efficiency improvement through central procurement, laboratory centralization and personal cost driving. Currently Alpha Medical operates 57 medical laboratories in Slovakia, Czech Republic and Poland.

Ownership portfolio

• AB Facility (in Poland, Czech Republic and Slovakia)
• Aero Vodochody (in the Czech Republic)
• Alpha Medical Ventures (and laboratories) (in Slovakia, Czech Republic and Poland)
• Dôvera health insurance company (in Slovakia)
• Dr. Max Pharmacy chain (in Poland, Czech Republic and Slovakia)
• EM&F Group (33,52% of shares) (in Poland)
• Fortuna Entertainment Group (in Poland, Czech Republic and Slovakia)
• Gehring Technologies^[5]
• Gimborn (in the Czech Republic and Germany)
• Hasau Group (in Slovakia)
• Iglotex (in Poland)
• Mecom Group (in the Czech Republic, Hungary and Slovakia)
• MediClinic (in the Czech Republic)
• PPC Energy Group (in Slovakia)
• Prima banka Slovensko (in Slovakia)
• Privatbanka (in the Czech Republic and Slovakia)
• ProCare (in Slovakia)
• Slovalco (in Slovakia)
• ZSNP (in Slovakia)

See also

• Economy of Slovakia
• Privatization in Slovakia
• Slovak political scandals

References

External links

• Current real-estate development projects by Penta