Posted on 06/10/2004 11:50:08 AM PDT by Grzegorz 246
Warsaw. (Interfax-Europe) - Top Polish fuel firm PKN Orlen signed a contract with the Czech National Property Fund (FNM) to buy a 63% stake in Unipetrol, the biggest Czech downstream oil firm, for EUR 417 mln, Orlen said in a market statement on Friday.
The Polish fuel firm promised to pay CZK 13.05 bln (EUR 417 mln) for Unipetrol, 9.76% of its subsidiary Spolana and receivables owed to some of the companies in the Unipetrol group. However, the agreement allows the buyer to adjust the price after an audit, down by as much as 25% and up by as much as 15%. The Polish firm will acquire over 114 mln bearer shares in Unipetrol.
"This transaction strengthens PKN Orlen's position as the leading Central and East European downstream oil and petrochemicals player, and further demonstrates that PKN Orlen is spearheading consolidation in the region," reads the statement.
PKN Orlen will pay 10 % of the total purchase price, or CZK 1.31 bln, within 15 days of the contract's signing, said FNM spokeswoman Petra Krainova. The balance is to be paid upon the transfer of shares to PKN Orlen and approval of the deal by the European Commission. The transaction is expected to close by the end of the third quarter of 2004.
Following the acquisition of Unipetrol, PKN Orlen will launch a mandatory tender offer to acquire the interests of minority shareholders in Unipetrol and its listed subsidiaries, Spolana and Paramo.
PKN Orlen has also agreed to sell some of Unipetrol's assets to global oil and gas company ConocoPhillips and to Agrofert, the Czech Republic's No. 2 chemical group. While Agrofert will buy non-core assets, such as agricultural commodity, pesticide and chemical firms, ConocoPhillips will buy one-third of the petrol stations currently owned by Unipetrol subsidiaries. The ConocoPhillips and Agrofert transactions are expected to close by end-2005.
"This should further reduce the indebtedness of the combined PKN Orlen-Unipetrol group," the statement reads.
The Czech government decided to sell its 63% stake in Unipetrol to PKN Orlen in late April. PKN Orlen made its bid independently. However, it had signed a preliminary agreement with ConocoPhillips in January. At the end of 2003, PKN Orlen signed a cooperation agreement with Agrofert, which had won a previous tender for Unipetrol, but failed to come up with the EUR 361 mln for the deal in 2002.
The Unipetrol group consists of 100%-owned subsidiaries Chemopetrol, Kaucuk, and Benzina, and the majority-owned subsidiaries CeRa (51 %), Paramo (74%) and Spolana (80%).
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