Prague, May 25 (CTK) – Czech-Slovak group J&T has received the Kc11.5bn it was owed by CEFC from China’s state-run CITIC Group, and it will start releasing CEFC’s pledges, J&T confirmed the information officially today after 14:00.
J&T and CITIC agreed on strategic cooperation and CITIC’s taking over CEFC’s debt to J&T, with Rainbow Wisdom, a company controlled by CITIC, buying the debt and gaining 9.9 percent in J&T Finance Group, J&T said this morning.
Vratislav Mynar, the head of the Czech Presidential Office, told CTK, and Jaroslav Tvrdik, deputy chairman of CEFC Europe’s board, tweeted in the morning that CEFC’s debt to J&T would be settled today, with all pledges being released, and CEFC Europe’s crisis management appointed by J&T would be dismissed.
The situation was caused by lawyers, Mynar said being glad the several-week efforts to buy the debt came to an end today.
CITIC Group has thus effectively taken over all assets of CEFC Europe, Mynar said.
J&T and CITIC representatives agreed to hold further talks on a possible development of cooperation and investment in joint projects.
Once the companies get a regulator’s approval, they will each propose a representative for the boards of J&T Finance Group a CEFC Europe.
Last week, J&T took over CEFC’s activities in the Czech Republic as the company failed to settle the debt in time.
CEFC China said the changes in CEFC Europe constituted an attempt at hostile takeover of the company and its Czech assets.
J&T said it made the changes after being informed that CEFC was taking steps aimed at preventing creditors from exercising their shareholder rights.
CITIC Group holds 49 percent in CEFC Europe.
Information about CEFC’s financial problems emerged following reports that CEFC group head Ye Jianming, an adviser to Czech President Milos Zeman, was investigated for suspected economic crimes.
Some time ago, CEFC chose the Czech Republic as a centre for its European activities and bought stakes in several Czech companies, such as air carrier Travel Service and travel agency Invia.cz. It controls brewery Pivovary Lobkowicz Group and engineering and metallurgy company Zdas Zdar nad Sazavou, and is a majority owner of the football club Slavia and Prague’s Eden stadium.
CEFC Europe manages assets exceeding EUR1.5bn (Kc38.34bn) in the Czech Republic.