Equity
Hungary MOL seen interested in majority stake in Poland's Lotos
Poland's Treasury Ministry holds a 53.19% stake in Gdansk-based Grupa Lotos and wants to sell its entire stake to strategic investors as part of a privatization plan aimed at plugging the country's budget gap, Dow Jones said.
The private equity funds may bid in consortia with each other or with strategic investors, they said. The potential consortium configurations are "still in flux," one of the people said.
A third person familiar with the matter said the non-strategic investors might not be private equity funds in the classic sense. "They may be sovereign or quasi-sovereign wealth funds from the middle east."
The Treasury Ministry has moved back the deadline for non-binding bids for a majority stake in Lotos twice already, most recently giving investors until 29 April (changed from 18 March) to submit their bids.
"The delay was based on feedback from investors," one of the people said. "They are trying to put together financing packages and need more time because of the demanding purchase conditions."
“The rumors on MOL’s interest in Lotos started to intensify in the last months. For us however the deal is quite unlikely to happen," commented Olena Kyrylenko, analyst at KBC Securities, in a morning comment on Friday.
“First, MOL is still digesting its INA projects, we expect the restructuring efforts in Croatia to be on the fore for the company. Second, MOL’s gearing is at 38%, above peer average and thus we see no room for significant investments in the near term. Third, there are no obvious synergies for wholesale and retail business of the company, whilst upstream potential is relatively low. Forth, we do not expect the selling price to be attractive enough. And last but not least, we can hardly imagine that Poland will hand the operational control of its own coastal refinery to the foreigner."
The private equity funds may bid in consortia with each other or with strategic investors, they said. The potential consortium configurations are "still in flux," one of the people said.
A third person familiar with the matter said the non-strategic investors might not be private equity funds in the classic sense. "They may be sovereign or quasi-sovereign wealth funds from the middle east."
The Treasury Ministry has moved back the deadline for non-binding bids for a majority stake in Lotos twice already, most recently giving investors until 29 April (changed from 18 March) to submit their bids.
"The delay was based on feedback from investors," one of the people said. "They are trying to put together financing packages and need more time because of the demanding purchase conditions."
“The rumors on MOL’s interest in Lotos started to intensify in the last months. For us however the deal is quite unlikely to happen," commented Olena Kyrylenko, analyst at KBC Securities, in a morning comment on Friday.
“First, MOL is still digesting its INA projects, we expect the restructuring efforts in Croatia to be on the fore for the company. Second, MOL’s gearing is at 38%, above peer average and thus we see no room for significant investments in the near term. Third, there are no obvious synergies for wholesale and retail business of the company, whilst upstream potential is relatively low. Forth, we do not expect the selling price to be attractive enough. And last but not least, we can hardly imagine that Poland will hand the operational control of its own coastal refinery to the foreigner."
