Business News

In Business News this week: the Czech Republic’s richest man Petr Kellner gains influence over the most valuable parts of Czech-Slovak group J&T; the Czech government sees no reason to bail out the country’s banks; Czech firms say they are experiencing a sharp fall in orders, and waiting longer for payment; and the Buddha Bar chain opens its first ever hotel in Prague.

Kellner’s PPF gains influence over most valuable parts of J&T group

The Czech Republic’s richest man Petr Kellner recently appeared on the front page of a Czech newspaper saying he had, like everybody else, lost money due to the credit crunch. This week, however, Kellner profited from the global financial crisis, when his PPF Group gained influence over the most valuable parts of the Czech-Slovak investment group J&T. PPF is paying J&T CZK 13 billion in exchange for transferring its heating stations, power stations, machine plants and foodstuffs firms into a newly created, joint-owned holding made up of over 20 companies. Both groups have 40-percent stakes, with the remaining 20 percent held by J&T’s Daniel Křetínský, who heads the new enterprise.

Topolánek rules out bailing out Czech banks

The Czech government sees no reason to bail out the country’s banks and is looking for other ways of reviving lending, the prime minister, Mirek Topolánek, said on Thursday. Nearly all the banks in the Czech Republic are owned by foreign companies and Mr Topolánek said the state would not bail out subsidiaries of foreign banks. He said the problem was not one of liquidity but of confidence.

Firms report sharp drop in orders and other problems as crisis bites

Czech firms have been hit by a sharp drop in volume of orders, a decline in trust within the business environment and a worsening in payment discipline, suggests a survey conducted this month by the Confederation of Industry. Respondents said the volume of overdue debts had grown by up to 50 percent, while the volume of liabilities was 40 percent higher. They also pointed to the risk of a decline in the continuity of supplies. Czech companies are under pressure to cut costs, and up to a third said they planned to make lay-offs.

Buddha-Bar opens first hotel near Prague’s Old Town Square

The French-owned Buddha-Bar chain of Eastern themed bars and restaurants has opened its first ever hotel in Prague. While the company has invested CZK 350 million in converting an Art Nouveau building near Old Town Square into a luxury hotel, its owner told Hospodařské noviny he was not worried the new venture would be adversely affected by the financial crisis. He said customers were getting more demanding when it comes to both service and experience.