Poland: PKN ORLEN and Grupa LOTOS in final stages for merger
Both firms have signed an agreement to transfer the LOTOS assets and a share exchange between firms for the creation of a multi-utility group.
PKN ORLEN and Grupa LOTOS have announced the signing of a merger plan that involves the transfer of the LOTOS assets to PKN ORLEN. Existing shareholders of Grupa LOTOS will receive shares in the enlarged PKN ORLEN in exchange for shares held. The transaction is subject to approval of the share exchange ratio and other terms of the merger by shareholders of both companies at their respective general meetings.
“Poland’s energy security as the driving force behind the country’s economic growth is for us a priority goal. This is why we are setting out to build a strong integrated group with well diversified revenue sources, resilient to the highly volatile macroeconomic environment. As was the case with our previous acquisitions, we intend to enhance the LOTOS post-merger value by leveraging the strengths of both combined entities,” said Daniel Obajtek, President of the PKN ORLEN Management Board.
Once the process is carried through, it will lead to the creation of a multi-utility group pursuing capital projects aimed to strengthen Poland’s energy security and its independence in terms of feedstock supplies. The combined entity to be formed based on the assets of PKN ORLEN, the Energa Group, Grupa LOTOS and PGNiG will be one of the largest companies in Central and Eastern Europe.
“The strong partner we have secured for the process, being a global petrochemical leader and the world’s largest oil producer, will provide added support. As a result, we will modernise and further develop our business, strengthening its resilience to the increasingly volatile market environment and driving sustainable value creation for our shareholders, retail customers and local communities,” added Obajtek.
The merged company will seek to achieve operational excellence in the existing business areas such as upstream and refining. Integration of the assets currently owned by different entities will bring about efficiency improvements, while strategic partnerships in this area will contribute to enhanced energy security of Poland and the whole of Central Europe.
