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Prokom close to selling Polnord to Pirelli - report

Italian conglomerate Pirelli&C is close to buying a controlling stake in Polish real estate developer Polnord for up to $277 million, a Polish newspaper reported, citing unnamed sources.

The Rzeczpospolita daily said Prokom Investment, an invest arm of one of Poland’s richest men, Ryszard Krauze, was in advanced talks with Pirelli to sell its 51.8% stake for 600-650 million zlotys ($255-$277 million). Prokom Investments spokesman Krzysztof Krol declined to comment, while Pirelli was not immediately available for comment.

The newspaper quoted another Prokom Investments spokesman as saying it was not currently in talks over Polnord, but added a sale cannot be ruled out. A merger of Polnord with engineering group Pol-Aqua collapsed earlier this year.

Krauze had said several investors have expressed interest in Polnord, but he was unwilling to sell the shares below 112.46 zlotys per share. Polnord shares, which are down 68% on the year, closed at 46 zlotys on Wednesday. Rzeczpospolita said a deal with Pirelli would value the stock at 70-75 zlotys per share. “The sides are close to reaching an agreement on the price,” a source close to negotiations told the newspaper. “The question is, however, whether the Italians, who suffered a steep sell-off, will close the financing for the deal.” (Reuters)