(Adds details, background)
WARSAW, Jan 11 (Reuters) - Poland surprised the markets on
Monday with plans to merge its biggest oil and gas firms to
forge central Europe's No.1 energy company and prevent any
hostile takeover threat.
Treasury minister Dawid Jackiewicz is considering tie-ups
between the state-run oil refiners PKN Orlen PKN.WA and Lotos
LTSP.WA , and gas firm PGNiG PGN.WA , with the analysis to be
ready by the end of this quarter.
Put together their joint market value would stand at 60
billion zlotys ($15 billion), almost twice as much as Austria's
OMV OMVV.VI and three times the market cap of Hungary's MOL
MOLB.BU .
"I have started works on this concept to find out what
positive effects one could expect," Jackiewicz said. "This is
about strengthening our position in these companies in order to
prevent attempts of hostile takeovers."
Poland controls PKN via a 27.5-percent stake, holds 53.2
percent in PKN's smaller rival Lotos and 72 percent of PGNiG.
Jackiewicz said that the treasury would consider more than one
merger option between the three.
The government, formed by last-year's election winner - the
conservative Law and Justice (PiS) party, considered merging PKN
and Lotos already in 2007, fearing the groups, which mostly
refine Russian oil, could be targeted by a Russian rival.
PKN's newly appointed chief executive, Wojciech Jasinski,
was the treasury minister in PiS' previous government in
2006-2007, working on the merger that did not happen.
The market worries that such a move now would add to a
campaign to seize more control over the economy by Poland's
ruling conservatives after the government already ousted several
top executives of state-owned companies, including PKN.
"This is another signal for the investors that the
government is entering the strategic sector. Investors want to
make money and the state has different, not necessarily
market-related aims," Radoslaw Lipinski, analyst at Pekao
Investment Banking said.
CHILEAN COPPER MINE
Jackiewicz added that the treasury has doubts about the
multi-billion investment by the also state-run KGHM KGH.WA -
Europe's No.2 copper producer - in Chilean mines.
KGHM's key foreign asset is the Chilean Sierra Gorda mine,
co-owned with Japan's Sumitomo 5713.T . It holds 5.5 million
tonnes of copper deposits, coupled with molybdenum, and launched
commercially last year.
KGHM gained control of Sierra Gorda in 2011 when it bought
Canadian rival Quadra FNX for C$2.87 billion ($2.04 billion),
the largest ever foreign acquisition by a Polish company.
Since then Chinese demand worries weighed on copper, used by
power and construction industries, while swelling oil stocks
have hit molybdenum, used in refining and steel production.
KGHM is now worth around half of its market cap at the end
of 2011. According to Jackiewicz, the miner should diversify its
operations, possibly into the energy sector to be less exposed
to copper price CMCU3 falls.
Poland's biggest bank PKO BP (L:BP) PKO.WA and insurer PZU
PZU.WA , both state-controlled, should in turn invest in
Poland's troubled coal mining firm Kompania Weglowa, which is
now looking for investors, the minister said.
($1 = 4.0023 zlotys)
($1 = 1.4099 Canadian dollars)