The Mlada Fronta publishing house, publisher of Euro weekly, has reached a financing agreement with Radovan Vitek’s CPI Property Group. CPI will provide it with a credit line of CZK 45 million, which will be drawn gradually. The real estate group wants to take over Mlada Fronta as part of the insolvency proceedings.
Finance from the CPI Group will help the Mlada Front, owned by František Savov, to continue the development of its existing activities and fulfill its business plan. He expects a slight profit this year.
Mladá Fronta has several divisions ranging from children’s titles, economic periodicals to professional medical books. It also includes the Books Division, which is currently the oldest continuously operating book publisher in the Czech Republic. Titles focused on the economy, and business can be a professional platform for providing synergies for CPI real estate activities.
MF came under pressure after the lending bank prematurely terminated the contract as a result of the insolvency proceedings and called for an operating loan to be paid. The Board of Directors has applied for protection from creditors, and management has initiated a crisis management process aimed at achieving reorganization while maintaining the company’s operations and jobs.
In November 2019, the Prague-based company Bazcom filed a petition to open insolvency proceedings. According to Mašek, the publishing house became a victim of the business war of business groups. Bazcom later withdrew his proposal, but a new one, filed by Bizpoint. So far, Bizpoint and Bohemia Silver have applied for claims, claiming almost CZK 16 million in total. According to Savov, the insolvency petitions are based on the Czechoslovak Group. In addition to CPI, it also applied for credit financing from the publishing house.
The flagship of the publishing house is the Euro weekly and the Euro.cz portal. Along with the Euro weekly, Top Specials, lifestyle magazines Essence and Hipster are also published. The Online Division also operates the Finance.cz Finance website and 12 other specialized online titles. The Books division annually introduces around 250 new book titles.
CPI Property Group is one of the most critical real estate groups focusing on long-term investment and real estate leasing, especially in Central and Eastern Europe and Germany. The majority shareholder of the Group, which manages assets worth a total of eight billion euros, is the real estate investor Radovan Vítek. Its registered office is in Luxembourg, and its shares are traded on the Frankfurt Stock Exchange.