News Parkiet

Petrochemicals

PKN Orlen to negotiate stock swap

with MOL

Internal memos obtained by PARKIET show senior executives at PKN Orlen oil refinery and Hungary?s MOL petrochemicals? group are set to agree on preliminary terms for future stock swap by April 8. Detailed stock swap documents are to be signed on April 30.

In a separate development, Polish Treasury Minister Zbigniew Kaniewski dismissed recent statement by his deputy Tadeusz Soroka, who said existing valuation of the two national oil groups effectively prevent any merger plans.

Power industry

Court ruling may force Elektrim to pay more for ZE PAK

Recent court verdict against Elektrim power and telecoms group could end up costing the company tens of millions of zlotys in extra compensation for the staff of Zespół Elekrowni PAK power plant. Warsaw court ruled in favor of ZE PAK union official, its shareholder, after Elektrim refused to buy out employee shares held by some 4000 workers at the plant. Elektrim has agreed to pay PAK employees 242 zloty per share during privatization sale in late 1990?s. However, the company refused to keep its side of the bargain after it run into financial difficulties later on. In December 2003 Elektrim subsidiary reduced the price to just 133.9 zloty, prompting a barrage of lawsuits and protests among PAK employees. In the worst case scenario Elektrim could end up paying as much as 120 to 150 million zloty plus interest for employee stock.

Elektrim already said it would appeal the verdict.

Telecommunications

Tel-Energo to merge with two smaller telcos

State-owned data carrier Tel-Energo is working on a merger with two smaller telecommunications firms, CEO Tomasz Kibil said in an interview with PARKIET. Shareholders of Telbank, another data carrier specializing in services for the banking industry have already agreed on a merger with much larger Tel-Energo. The transaction will close by July 1, Kibil said, adding merger of the two firms will cost less than 20 million zloty, including severance pay related to planned staff cuts.

Tel-Energo is also planning to buy 65 percent stake in Niezależny Operator Międzymiastowy DLD carrier in early June.