LONDON, July 3 -- The European Union'sEuropean Bank for Reconstruction and Development issued the following news release:
The European Bank for Reconstruction and Development (EBRD) is purchasing Euros40 million of senior unsecured Eurobonds of Powszechny Zaklad Ubezpieczen S.A (PZU) via PZU's wholly-owned subsidiary, PZU Finance AB, as part of an inaugural Euros500 million issue by Poland's leading insurance company. The funds raised through this debut issuance will support the insurer in diversifying its business via international expansion and will also improve its capital structure.
PZU's strategy is to establish itself as a regional player in the fragmented insurance market of central and eastern European (CEE). The proceeds of the bond issue will be used primarily to build capital for the acquisition of controlling stakes or significant minority investments in insurance companies or other financial institutions in countries where the EBRD works. Regional expansion is one of PZU's main areas for investment as part of a strategy to create growth and generate value for its shareholders.
Nick Tesseyman, EBRD Managing Director, Financial Institutions, said: "With our investment in PZU's first Eurobond issue, the EBRD is supporting the company's strategic acquisitions and investment plans. For the wider insurance market in the region, this expansion will result in increased competition from which customers are expected to benefit."
Przemyslaw Dabrowski, Chief Financial Officer of PZU, said: "The very successful placement of senior debt on the Eurobond market by PZU - a financial institution firmly rooted in the CEE region - confirms that investors have a robust perception of the overall macroeconomics and financial position of companies in the region. PZU SA sees the cooperation with the EBRD as an excellent opportunity to further develop our high standards of insurance and to expand the depth of the region's financial markets."
Since the beginning of its operations in Poland in 1991, the EBRD has invested almost Euros7 billion in more than 330 projects in the country. In addition to its wide product range for banks and companies, in recent years the Bank has also built a growing portfolio of investments (both equity and debt) in the Polish financial sector, for which demand remains high.
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