Government approves sale of public capital in Progres

At the session on June 27, the Government of Serbia adopted the decision on the process of the privatization of the famous company Progres AD.

The document that Biznis.rs has had an insight into says that the government agrees for 100% of the public capital in that company to be sold. The question, however, is what the price of the capital will be – considering that the former giant has considerable property in the form of real estate, but also shares in other companies, including the Trepca mine.

According to the data of the Securities Commission of the Republic of Serbia, the “state” co-owners of Progres – the Equity Fund, the Pension and Disability Insurance Fund of the Republic of Serbia, the City of Belgrade, the Republic of Serbia and the Development Fund, have at least 51% of the capital, and of them, the biggest set belongs to the Equity Fund.

If, then, the state enters the process of privatization with all the shares that belong to it, the potential new owner of Progres AD might buy a majority stake, but that brings us back to the question of the value of the capital of Progres.

For example, the small shareholders of Progres, which have been fighting for the preservation of the property and fair treatment when it comes to handling the capital, reminded in a statement at the end of May that the Republic of Serbia had become the majority owner of Progres in 2011 by accepting shares which had had a nominal value of RSD 600 per share at the time for tax and contribution claims in the amount of RSD 425 million instead of cash.

They also pointed out at the time that, as per the state’s order, several years before, Progres had had to report a loss based on the lawsuits won by Procter & Gamble and Gazprom Banka, causing its price to rapidly drop in the market, remaining that way since.

The data of the Belgrade Stock Exchange are even less favorable for the owners of the capital of Progres AD, whether “large” or small.

As of August 22, a share of Progres was worth only seven dinars, whereas the market capitalization of the former giant amounts to only RSD 42.83 million, or slightly over EUR 365,000.

Vlada Republike Srbije

Grad Beograd

Fond za razvoj Republike Srbije Niš

Progres a.d. Beograd

Republički Fond za penzijsko i invalidsko osiguranje

Akcionarski fond Beograd

Government of Serbia

Progres AD

Equity Fund

Pension and Disability Insurance Fund of the Republic of Serbia

City of Belgrade

Development Fund

sale of Progres