A Luxembourg court has definitively confirmed the conclusions of the Luxembourg Commission for the Supervision of the Financial Market. As per the verdict, Radovan Vítek's companies had been engaged in manipulation during the takeover of developer Orco, Seznamzpravy.cz reports.
According to the Luxembourg Commission for the Supervision of the Financial Market (CSSF), Radovan Vítek secretly colluded with the founder of Orco, Jean-Francois Otte, in the takeover of this company. One of the richest Czechs and the owner of the real estate group CPI Property Group manipulated the share price between 2012 and 2016 to pay less for the acquired property. According to the Luxembourg regulator, he violated legal regulations and could harm other shareholders.
"The Luxembourg Financial Market Supervisory Commission with this informs the public that, by three decisions dated June 27, 2024, the Administrative Court rejected the claims filed against the judgments dated November 21, 2023," the commission said in a statement.
The court's decision, which cannot be appealed, ends Radovan Vítek's seven-year legal battle against the decision of the Luxembourg regulator. The commission issued several decisions in 2017 regarding a hostile takeover of Orco, imposing an administrative fine on Vítek in an undisclosed amount.
“In 2017, the CSSF imposed an administrative fine on the shareholders of CPI FIM, formerly Orco Property Group. The shareholders contested this fine. The CPI PG Group did not directly participate in this event and maintains a regular, constructive, and fully transparent dialogue with our regulator," CPI Property Group spokesperson Jakub Velen told SZ Byznys.
In its December 2017 decision, the CSSF concluded that Vítek manipulated information, for example, in a press release by Crestline Ventures Corp. and Gamala Limited dated 18 October 2012. Together, these firms acquired a 20.69% stake in Orco Property Group. According to the CSSF, Vítek also manipulated the market when he used Aspley Ventures, Fetumar Development, and Jagapa Limited to subscribe to 1.2 billion new Orco shares in November 2014 and May 2016. The complex case ended with Radovan Vítek taking over Orco's most valuable asset. These are, for example, plots near the Nádraží Holešovice metro station in Prague, where a new urban district is to be built, and many other properties.
CPI Property Group has grown to its current multi-billion dollar value since its foundation in the 1990s, when Vítek, as a student, hostilely took over the properties of the Včela cooperative. It took on significant debt in 2021 due to the takeover of Austrian firms Immofinanz and S Immo. In addition, in May 2024, Standard & Poor's lowered the rating of CPI PG. The Group is currently selling properties to reduce its debt following a sharp rise in interest rates that made financing more expensive.
