Forton Legal advised on the reduction of PKP Cargo’s share capital to PLN 2.1 billion.

We are pleased to announce that the Forton Legal team actively participated in advising PKP Cargo S.A. on restructuring, reducing the company’s share capital in order to adjust it to the actual state.

PKP Cargo S.A., a leading rail freight carrier in Central Europe, is listed on the Warsaw Stock Exchange. Due to a significant balance sheet loss for 2024 (PLN 2.4 billion), the company sought solutions to its problems, including covering the deficit and adapting its structure to the needs of a possible additional capital raising. This required taking into account that the previous nominal value of the Company’s shares was PLN 50 per share, with a market price ranging between approximately PLN 15 and PLN 17, which made it very unlikely that the necessary capital could be raised from the market through the issue of new shares, as the minimum issue price of the shares was PLN 50. This is due to the fact that shares cannot be acquired below their nominal value, and on the other hand, investors are not interested in acquiring shares at an issue price that is significantly higher than the current stock market price of the shares.

For this reason, Forton Legal proposed to PKP Cargo S.A. to reduce its share capital by decreasing the nominal value of all the Company’s shares without the need to conduct a convocation procedure, which would not be possible given the current state of the company. Thanks to this solution, the Company can perform an accounting operation to cover losses from previous years. In addition, the current capital structure of the Company better positions it for the future, should the opportunity to attract an investor arise, as the potential issue price of the shares may at that point be close to the market price of the shares on the WSE.

The implementation of the described capital changes is an important step for PKP Cargo, aimed at making its capital structure more flexible and adapting the Company to a new stage of its development. We are pleased to have been able to provide legal support to PKP Cargo S.A. in this process.