Grupa Azoty and Orlen have
initiated negotiations for the potential sale of Grupa Azoty Polyolefins'
shares. The due diligence and transaction terms are expected to be finalized by
March 31, 2025, as part of Grupa Azoty's strategic recovery plan.
Poland: Orlen and Grupa Azoty have announced
plans to explore a potential transaction involving the sale of all or part of
Grupa Azoty Polyolefins' shares to Orlen or its designated entity. The
negotiations, supported by a Cooperation Agreement and an earlier Letter of
Intent, include due diligence and finalizing the terms of the deal by March 31,
2025, with an option for extension.
Adam Leszkiewicz, President of the Management Board of Grupa Azoty S.A. said:
"Since December, based on the signed Cooperation Agreement and the earlier
Letter of Intent, we have been working intensively on potential solutions for
the future of Grupa Azoty Polyolefins. As a result, we can now unequivocally
confirm our chosen direction, which is to sell all or part of Polyolefins'
shares held by Grupa Azoty. At this stage, we will begin due diligence and seek
to negotiate the terms of a potential transaction. At Grupa Azoty, we believe
that this collaboration can bring mutual benefits. From our perspective, a
potential transaction is one of the key elements of our ongoing Recovery
Program, under which we are developing a new business model for the Group."
These discussions are being conducted
under the Agreement signed by Orlen S.A., Grupa Azoty S.A., Grupa Azoty Police
S.A., and Grupa Azoty Polyolefins S.A. The Agreement is part of the broader
Cooperation and Stabilization Agreement among Key Stakeholders, signed on
December 19 of the previous year by the Grupa Azoty companies, Orlen S.A.,
Hyundai Engineering Co., LTD., and the Korean Overseas Infrastructure &
Urban Development Corporation.
According to TechSci Research, the potential acquisition of Grupa
Azoty Polyolefins by Orlen represents a strategic move with promising benefits
for the chemical industry. The transaction, which could involve the acquisition
of all or part of Grupa Azoty's shares in Polyolefins, is expected to foster
increased consolidation within the sector. This could lead to enhanced
operational efficiencies, greater market competitiveness, and a strengthened
position for Orlen in the polyolefins market, which plays a critical role in
the chemical and plastics industries.
Moreover, the ongoing
negotiations and due diligence will likely bring innovative solutions to Grupa
Azoty's restructuring efforts, ultimately benefiting the broader chemical
supply chain. The collaboration between Orlen, Grupa Azoty, and other key stakeholders,
such as Hyundai Engineering, aligns with global trends of industry
consolidation and modernization. By streamlining operations and optimizing
resource allocation, the deal could stimulate growth, expand production
capabilities, and foster sustainability initiatives within the sector.