Another major milestone towards acquisition of LOTOS Group by PKN ORLEN
PKN ORLEN has signed a memorandum of understanding with the Polish State Treasury and Lotos Group concerning its intended acquisition of a controlling stake in the Gdańsk-based company. It represents another stepping stone to establishing an integrated and strong business, capable of successfully competing on international markets and significantly strengthening Poland’s security in fuels and energy.
Outlining the transaction’s framework structure, the MoU also confirms the direction and key objectives of the proposed merger first defined in the Letter of Intent signed between PKN ORLEN and the State Treasury in February 2018. The document provides that the transaction details may be further specified, based in particular on remedies resulting from the European Commission’s decision.
‘This is another major milestone in the process of PKN ORLEN’s acquisition of LOTOS Group. For the first time, the transaction framework has been confirmed by all the parties. The decision to combine the potential of both companies is of strategic importance both in terms of their further business expansion and diversification of crude oil supplies, a crucial thing for the security of Poland, but also the entire region. From operating within one group will benefit the companies themselves, their local governments and customers. We have no choice but to brace ourselves for increasingly fiercer market competition. Most of our European rivals have long since gone through their own consolidation processes and are now able to effectively leverage the resulting advantages. We cannot afford to lag behind, which is why we are determined to pursue this project for the benefit of the Polish economy,’ said Daniel Obajtek, President of the PKN ORLEN Management Board.
The new entity will be a strong regional player, but will continue to support its local communities. Once combined, it will also be better placed to engage in initiatives spanning social outreach, culture and sports across the region. Its coordinated CSR policy will deliver stronger and more thorough support for local communities.
Importantly, the Gdańsk province will continue to receive income from CIT, PIT and property taxes. Benefits for LOTOS will include the ability to win new business and gain a foothold in new market segments, while developing its presence in those where it is already active, such as electric mobility and hydrocarbon production. The consolidation will involve business process optimisation, without reducing staff levels. No jobs will be made redundant. On the contrary, employees will be able to grow professionally, working for a larger and stronger organisation of international stature.