(Adds details, share reaction, newspaper report)
PRAGUE, June 8 (Reuters) - Telecoms company O2 Czech Republic’s majority owner PPF said on Monday other shareholders would get 78 crowns per share in its planned buyout offer, 58 percent above the stock’s notional price set after the company spun off its infrastructure business last week.
The stock fell 5 percent to align with the planned offer, trading down at 77.30 crowns on Monday.
Investment group PPF, which holds 84.7 percent of Czech O2 after buying a majority stake from Spain’s Telefonica in 2014, also said it is offering to buy up shares in CETIN , the new infrastructure company, at a price of 176 crowns a share, sending the market price up 24 percent to 171.40 on Monday.
O2 shareholders were given one share in CETIN for every share held in O2 in the split.
The stock price of Czech O2 had taken a hit after shareholders agreed at the end of April to the spin-off, but the combined offer of 254 crowns for shares in both O2 and CETIN was 76 crowns above where O2’s stock traded before the split.
Analysts have said that a drop in the share price in O2 prior to the split was caused by the fact that shares in CETIN are traded on the Prague bourse’s unregulated free market, forcing many funds to sell the stock prior to the spin-off.
After a brief suspension before the split of the company, the Prague bourse re-opened trading in Czech O2 with a reference price of 49.40 crowns on June 1.
Analysts at J&T Banka said it was still not possible to determine the fundamental value of the Czech O2 shares until its earnings performance is known.
“Therefore we think that the price of the voluntary buyback offer of CZK 78 may serve as the lower end of support for O2’s shares on the market,” the bank said in a note to clients.
Czech O2 has said that CETIN contributed about 50 percent of the group’s operating profit before the spin-off.
The fall in the Czech O2’s stock price had prompted some large Czech private investors to buy up shares.
Daily newspaper Hospodarske Noviny said on Monday Pavel Tykac, the owner of mining group Czech Coal, had taken a 2 percent stake in Czech O2 by investing around 1 billion crowns ($40.55 million).
Another investment group, Arca Capital, has also invested 350 million crowns to get a 0.6 percent stake, the paper said.
“When we looked, it was clear that O2 was undervalued because, among other things, funds were forced to sell out,” Arca co-owner Pavol Krupa was quoted as saying. (Reporting by Jason Hovet; Editing by Greg Mahlich)