Czech PPF Group takes control of Eldorado

Czech PPF Group takes control of Eldorado
The Czech Republic’s PPF Group has taken effective control of Russian electronics and home appliance retailer Eldorado after buying a 10% stake in the company from Generali for € 46 million.

The move comes after PPF and Generali together paid $300 million for a 50% + 1 share stake in the company in October 2009. Milan Tománek, Head of PPF Group Communications, talking to Vedomosti, said PPF is a long term investor in such projects, while Generali’s main aim was to generate profit for its shareholders.

Jiri Smejc, a shareholder in the PPF Group, says the move was made mostly to increase the efficiency and attractiveness of the Company.

"In 2010,we didnotcarry outanymajor divestments,butwe completed a number of steps towards optimizing our ownership ofassets, andcompletedtheturnaroundprocessforEldoradotobecome a transparent and profitable company."

PPF has disclosed the purchase in its annual accounts, with the transaction having taken place in December 2010, with the accounts noting it will lead to a € 25 million reduction in a non controlling interest charge of €90 million incurred with the original acquisition.Eldorado founder Igor Yakovlev retains 50% minus one share.Eldorado has 330 stores in Russia, with plans to invest $100 million in 2011 to open 40-50 new stores.