OMV would like merger of equals with PKN

Sep 15, 2001 02:00 AM

Austrian oil and gas group OMV would like a "merger of equals" with Poland's dominant refining company PKN Orlen, CEO-designate Wolfgang Ruttenstorfer said. He said the group also had other interests in expanding in central and eastern Europe.
"Right now we're focussing on PKN, but that doesn't rule out other things," he said. "We're taking it one step at a time. But we do want to be the leading oil and gas company in central Europe." OMV has bid for a 17.6 % stake in PKN from the Polish government, competing with Hungary's state-controlled MOL, in which OMV owns a 10 % stake.
"We're willing to go into a partnership (with PKN), into a merger of equals," said Ruttenstorfer, who is due to replace Richard Schenz as OMV's CEO next year. Polish media say OMV has bid 30.50 zlotys ($ 7.20) per share for the PKN stake versus a 30 zloty bid from MOL.

Ruttenstorfer said the price was only one criterion in the decision. The bidders' future plans for PKN were also key. Asked if OMV wanted a larger stake in PKN than the 17.6 % now on offer, he replied, "Our confidentiality agreement prevents me from commenting."

The Polish government had originally intended to make a decision on the PKN sale before the September 23 general election, but this now appears unlikely. Ruttenstorfer said he had no idea how the Polish government would decide or if a decision would fall before the election. But he said the privatisation of PKN was not an election issue and was solely in the hands of the government.
Poland's leftist opposition, widely expected to win, is opposed to the PKN sale. The Polish state has floated around 72 % of PKN since the start of its privatisation in 1999. Ruttenstorfer described OMV as the ideal partner for PKN. "PKN and OMV are practically the same size. Poland brings a gigantic market and an excellent refinery. But we also have assets," he said.

OMV was the only central European oil firm with a strong international exploration and production (E&P) business, currently present in 13 countries. It had a strong brand name in 10 countries throughout central and south-eastern Europe and also had a petrochemicals business which no other country in the region could offer. Petrochemicals were "terribly important" for Poland, Ruttenstorfer said.
"Last but not least, there's cash. We have the best results and the highest degree of efficiency. And this financial power separates us from the others. There's no question about that." In the first six months of 2001, MOL reported a net loss of $ 17.15 mm, while OMV, building on record 2000 results, said its net profit soared 78 % to 222 mm euros ($ 203.7 mm).

OMV's consolidation plans do not stop with Poland. Last month, the Austrian firm submitted a bid for a stake in Greece's largest refiner Hellenic Petroleum. Hellenic would make an excellent "partner with whom we can work from the south upwards," Ruttenstorfer said.
Greece's government wants to sell a 15 to 30 % stake in Hellenic. OMV faces two rival bids from Russia's Yukos Oil and Russia's LUKoil jointly with Greece's Latsis Group. The Greek government's privatisation advisers are currently evaluating the bids and Ruttenstorfer said it was unclear how long this process would last.
Ruttenstorfer declined to comment on whether OMV was interested in participating in the privatisation of Croatia's state-controlled refining company INA, which the Zagreb government expects to sell next year. "It would make no sense to state all our interests in detail at present," he said. Analysts say INA's stake in a major oil pipeline running from the Adriatic to the Czech Republic would make it especially attractive.

Ruttenstorfer said OMV still expects to post another set of record full-year earnings this year but there was some uncertainty about the outlook. "There are two things working against each other. On the one hand, there's the crisis (caused by the terror attacks) and on the other hand, the (global) economic weakening. I can't say what the outcome of either will be," he said.

Source: Gulf News Online
Alexander's Commentary

Change of face - change of phase

In the period of July 20 till August 3, 2015, Alexander will be out of the office and the site will not or only irreg

read more ...
August 2020 »
1 2
3 4 5 6 7 8 9
10 11 12 13 14 15 16
17 18 19 20 21 22 23
24 25 26 27 28 29 30

Register to announce Your Event

View All Events