Natland’s cash for trash firm stake leaves questions

Some of the secrecy surrounding a minority shareholding in Prague’s money-spinning municipal trash company has been lifted with the announcement that Czech financial and investment company Natland Group has bought the stake from the mysterious Cyprus-based company Soranus Limited.

Czech Position at the start of June began asking questions about the stake held by the Cyprus company, in turn owned by British shell company Nettrubino Limited. The majority owner of trash company Pražský služby — Prague City Hall — was unaware of who its partner was, with many indications pointing to influential investment group PPF.

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PPF sold the 15.8 percent stake it owned (which translated into voting rights of 19.3 percent) back in October 2010, but there was always the suspicion that it had somehow held on. In the latest turn of events, PPF features with its banking arm partially financing Natland’s acquisition. Pražské služby still owes PPF banka Kč 750 million, which is not an insignificant amount.

For those who like short, quick and simple mysteries, Natland’s acquisition would appear to draw a line under the ownership mystery. The trouble is that even this announcement leaves many loose ends and questions. 

Odd numbers

There is, for example, the obvious disparity that Natland says it bought an 18.85 percent shareholding in Pražský služby, although Soranus only owned 15.8 percent. Where do the extra 3 percent of shares come from?

Second, who was hiding behind Soranus and Nettrubino Limited? This is still a secret even following Natland’s announcement, timed a few days before Pražský služby’s general meeting. Ownership is usually kept secret if the owner does not want to appear rich — or if the origin of the cash behind the investment is less than clean.

Influential Prague businessman Tomáš Hrdlička, who has legendary close links to the top of the Civic Democrats (ODS) and Social Democrats (ČSSD) who now rule Prague City Hall under a coalition deal, is frequently talked about as the owner of Soranus. Hrdlička denies any connection and Prague Mayor Bohuslav Svoboda (ODS) is apparently unable to answer the question. “At the moment, I do not have sufficient information on which to confirm or deny, and I refuse to speculate,” City Hall spokeswoman Tereza Krásenská said.

Hrdlička’s hand?

Speculation is also rife concerning Hrdlička’s links with Natland, which came to a head when it stepped in earlier this year to become the majority owner of famous Czech football club Slavia Prague. It was suggested at the time that Hrdlička was working hand in hand with the well-known Prague lobbyist Roman Janoušek. Natland Group  has, not surprisingly, denied any links. Natland sooner or later can be expected to also announce its ownership of the modern Eden stadium, where Slavia plays its home games.

Natland Group shareholder Tomáš Raška gave the following explanation for its surprise investment in another new sector, waste. “Our choice of investment opportunities is not predetermined in advance. We evaluated Pražský služby as an interesting financial investment thanks to the possibility of thermal use of mixed waste and construction of a new cogeneration unit.”

It should be added that garbage is big business, and Pražský služby is a highly profitable company. It also owns the municipal waste incineration facilities in Prague 10–Malešice to which Raška referred.

Even so, if Natland Group believed the investment opportunity so captivating, why didn’t it  jump at the chance to acquire the stake when PPF was selling in October last year, especially if relations are good enough for PPF to be providing part of the cash for the transaction this time round?