AD Hoc Group to try and save ailing coal mining company OKD
The Ad Hoc Group, representing a group of foreign investors who have become the new owners of New World Resources and the Czech coal mining company OKD, have made clear their intention not only to save the ailing latter firm but to keep its mines running for years to come.
The big question is whether the group’s plans for saving OKD will be realistic. Czech Radio reported it was not yet clear just how much will be needed to save the troubled company, but the conventional wisdom suggests funds in the hundreds of millions of crowns (on the conservative side) and more likely billions. With current market conditions far from favourable (the price of black coal has dropped by 70 percent over the last six years) even positive steps won’t mean any transition saving the firm will be painless or that jobs won’t be lost.
The government, meanwhile, is waiting for a confirmation of the change in ownership before stepping in; it, understandably, wants to be sure it is dealing with the rightful owners before it comes to the table. Czech Radio cited the Minister for Industry and Trade Jan Mládek as saying once the change in ownership was official, the government would be ready to listen. The soonest that could happen will be within one month.