CSG Faces Dual Headwinds: Short-Seller Allegations and a €1.4 Billion Shareholder Dispute

Defence conglomerate CSG battles a short-seller report and a €1.4 billion minority investor claim, as shares halve from January peak and volatility tops 85%.

The Czechoslovak Group is navigating one of its most turbulent periods since debuting on the Amsterdam exchange in January, with the defence conglomerate simultaneously fending off a short-seller attack and a billion-euro claim from a minority investor.

Shares in the company have been battered since a report from Hunterbrook Media questioned the core of CSG’s business model, alleging that its large-calibre ammunition revenue relies primarily on the resale of old stockpiles rather than genuine manufacturing. The stock plunged as much as 26% on Monday, touching a fresh year-low of €15.73, before recovering slightly to trade around €16.35. From its January peak, the equity has now shed more than half its value, with annualised volatility topping 85%.

Management Fires Back on Production Claims

CSG’s leadership has pushed back hard against the short-seller narrative. The company disclosed that it produced roughly 630,000 rounds of ammunition in-house last year and expects output to grow by approximately 20% in 2025. A new production line in Slovakia is slated to add 70,000 rounds of large-calibre ammunition to the mix by 2026.

“Anyone who reduces our capacity to a single location misunderstands the industrial model,” a company representative said, rejecting the suggestion that CSG is merely a trader of legacy munitions. Management also reiterated its intention to significantly reduce the refurbishment of old stockpiles over the medium term.

The €1.4 Billion Question

Adding to the pressure, minority shareholder Terzo Company — controlled by Petr Kratochvíl — has lodged a claim worth roughly €1.4 billion under an opt-out procedure. CSG spokesman Andrej ?írtek described the matter as a “standard commercial affair” and stressed that no binding valuation has yet been reached. The company insists that all minority stakes and the broader corporate structure were fully disclosed in the IPO prospectus published ahead of the January listing.

Cash Movement and Internal Tensions

On a more concrete front, CSG confirmed that an intra-company receivable of €275 million was fully settled in cash during the first quarter of 2026. The sum originated from the pre-sale of several non-core divisions — including the mobility, healthcare and Perazzi businesses — and was executed at market terms based on independent valuations. Management views the settlement as a clear signal to investors who have questioned the transparency of internal cash flows.

Reports of boardroom rifts have also been dismissed. Chairman and owner Michal Strnad reaffirmed the group’s international expansion strategy, pointing to the new Slovak production line as evidence of forward momentum.

All Eyes on May 20

The next major test arrives on May 20, when CSG publishes its first-quarter results. Investors will be scrutinising whether operating cash flows and the order book — which management describes as “full” — back up the company’s narrative. With NATO member states and other clients driving sustained demand for defence equipment, the earnings release will either validate the growth story or deepen the scepticism that has sent the stock reeling.

Until then, the company’s detailed rebuttal of the short-seller claims remains its primary defence in a market that has shown little patience for uncertainty.