Orlen’s CEO Daniel Obajtek explains that it is part of the plan to build a multi-energy concern and consolidate state-owned fuel companies.
PKN Orlen has notified the Office of Competition and Consumer Protection of its intention to take over PGNiG. This is another step of PKN Orlen in its consolidation of state-owned energy companies.
PKN Orlen submitted an application for the acquisition of PGNiG on May 10. As indicated, this is the formal initiation of the merger control procedure. Orlen would take direct control of PGNiG.
“In addition to presenting the parties and the assumptions of the transaction, the application describes the activities of the parties in certain relevant markets and presents arguments regarding the impact of the transaction on competition in these markets,” Orlen said. According to Orlen, the acquisition of PGNiG is to increase competitiveness on the global market and accelerate the green transformation of the Polish energy sector.
PKN Orlen and the State Treasury signed a letter of intent on July 14, 2020 to start this process. On July 23, 2020, PKN Orlen and PGNiG concluded a cooperation and confidentiality agreement. The willingness to consolidate was also reported to the European Commission.
Orlen estimated that the acquisition could be finalized by the end of 2021.
Currently, the capitalization of PGNiG on the stock exchange is PLN 38 billion. The concern has not yet announced how it will finance the purchase of PGNiG. Currently 72% of PGNiG shares are owned by the State Treasury.