Anti-corruption police called in to ArcelorMittal Ostrava

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The Independent Online

Czech anti-corruption police are investigating complaints by minority shareholders of ArcelorMittal Ostrava, the Czech subsidiary of the giant steel company, that Arcelor has been draining money out of the steel-maker.

Small shareholders, including the Czech consumer finance group PPF, claim that AMO could make losses of up to Czech Koruna 744m (£25m) because of up to CZK25bn in low-interest loans made to the parent. They claim the money could have been invested better elsewhere or used to pay dividends. They are also upset by AMO's plan to use the company's shares as loan collateral, under an agreement that was to go to an EGM in August, but which has now been cancelled.

PPF, run by the Czech oligarch Petr Kellner, owns a 14 per cent stake in AMO. A PPF spokesman, Alexej Bechtin, said: "This might have serious consequences during the economic crisis, given the borrower's current financial results. Because of these loans, shareholders have been stripped of their dividends. We will pursue our legitimate request by all means available."

Mr Kellner is one of the world's richest men, building his insurance-based fortune during Czech privatisation. He is one of the biggest insurers in central Europe and Russia.

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