MOSCOW (MRC) -- Poland’s PKN Orlen said on Friday that the European Commission has extended the deadline for the realisation of remedies in its planned takeover of Polish refiner Grupa Lotos to 14 January 2022, said the company.
"The complexity of the process in a very demanding macroeconomic environment requires additional time to negotiate with partners in order to obtain the best possible transaction conditions and enable corporate decisions to be made also on the part of the partners," Orlen said.
In a parallel effort to the process of merging with Grupa LOTOS, work is underway on PKN Orlen’s acquisition of the PGNiG Group. The objective is to form a group with total annual revenue of approximately PLN 200bn and diversified EBITDA, estimated at approximately PLN 20bn. This means that in terms of capitalisation and financial results, the potential of the future Polish multi-utility group will match or even exceed that of its European competitors.
The acquisition of Grupa LOTOS by PKN Orlen was initiated already in February 2018 by signing a Letter of Intent with the Polish State Treasury, which holds 53.19% of voting rights at the General Meeting of the Gdansk-based company. In November 2018, a draft application for approval of the concentration was submitted by PKN ORLEN to the European Commission. In early July 2019, the final application was submitted to the European Commission, and on July 14th 2020 the Commission conditionally cleared the acquisition of Grupa LOTOS by PKN ORLEN. In August 2020, PKN ORLEN has signed a memorandum of understanding with the Polish State Treasury and Grupa LOTOS concerning its acquisition of Grupa LOTOS shares and thus control of the Gdansk-based group. In May 2021, PKN Orlen, Grupa LOTOS and the Ministry of State Assets signed an agreement on the structure of the new multi-utility group to be established through the merger of three companies: PKN Orlen, LOTOS and PGNiG.
The oil and petrochemicals company added that it expected the formal completion of the takeover of fellow state-controlled Lotos within the first half of next year. Orlen is Poland’s largest refiner, while Lotos is its second largest.
As per MRC, in August 2020, PKN Orlen signed a non-binding agreement with the state treasury and Grupa Lotos to shape a deal to take direct or indirect capital control of fellow state company Lotos.
Ethylene and propylene are the main feedstocks for the production of polyethylene (PE) and polypropylene (PP), respectively.
According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 1,868,160 tonnes in the first nine months of 2021, up by 18% year on year. Shipments of all grades of ethylene polymers increased. At the same time, PP shipments to the Russian market were 1,138,510 tonnes in January-September 2021, up by 30% year on year. Supply of propylene homopolymer (homopolymer PP) and block-copolymers of propylene (PP block copolymers) increased, whereas supply of injection moulding statistical copolymers of propylene (PP random copolymers) decreased significantly.
PKN Orlen would be the first refining and petrochemicals company in Europe to use the Honeywell UOP MaxEne technology for molecule management of a naphtha stream to produce high-quality products including olefins, aromatics and gasoline.
MRC