President of Orlen, Daniel Obajtek commented on Tuesday on Republika TV about the information about the initiation by District Prosecutor’s Office in Płock (Masovian Voivodeship) investigation regarding the merger Orlen With Lotos Group. This includes: on suspicion of abuse of powers and failure to fulfill duties by members of Orlen’s management board and other persons, causing damage of not less than PLN 4 billion.
“We are not afraid of these issues because the entire process was carried out properly. 23 Polish and international institutions worked on this process, there are valuations. Some refineries (Gdańsk Refinery – PAP) I emphasize, it was sold for the market price, we have analyzes in this regard,” Obajtek emphasized.
“If you want to comment on this topic at all, you need to know all the documents, you need to see these contracts, you need to analyze these contracts thoroughly in order to speak in this way,” Obajtek noted. “The prosecutor’s office is here to investigate, we have nothing to hide,” he added.
He also assessed that such actions destabilize Orlen’s situation. “International investors will slowly withdraw, the share price will go down. This is playing on the security of the state, endangering this security, and we are having a war on the borders,” he stressed.
Wasn’t Kaczyński behind the merger? A complicated process
The president of Orlen also responded to the question whether Jaroslaw Kaczynski he ordered him to carry out the merger of Orlen and Lotos. He replied that under no circumstances had anyone forced him to make such decisions.
“It was a business process that was viable in business terms (…). Thanks to all these mergers, we will achieve PLN 20 billion in synergies (…). This means that thanks to the merger we have additional capital,” Obajtek emphasized.
He explained that the merger was not carried out by “one person”. “It was a very complicated stage, it lasted 4 years under the full supervision of the state and the services. (…) We had meetings where virtually all representatives of the services were present,” said Orlen’s president.
He also recalled that the shareholders – owners of Orlen and Lotos, agreed at the general meeting to the process of merging the companies. He also pointed out that Treasury before the merger of Orlen and Lotos, he had over 27 percent in Orlen. shares. “This means that Orlen could have been taken over by other entities. After the mergers, the State Treasury in Orlen has almost 50 percent. This ensures energy and fuel security for the state. The state also has a larger share in Orlen’s profit. We have paid out over PLN 14 billion in recent years dividends for shareholders,” Obajtek noted.
NOBODY was allowed in
He also commented on the accusation Supreme Audit Office (NIK), that part of the Gdańsk Refinery was sold Saudi Aramco at a reduced price.
“If you want to speak in this way, you need to have all the analyzes and all the valuations and evaluate all the synergies. We don’t know what kind of audit the Supreme Audit Office did, because it didn’t audit us. The Supreme Audit Office was not allowed in because there are no public funds here. The Supreme Audit Office was not allowed into the Orlen also earlier, because according to the Act, the Supreme Audit Office should audit public funds. Orlen has shareholders’ funds. And all shareholders have an equal right to access information about the company,” Obajtek said.
Blackmail by Russia?
He also assured that he was not afraid of the possible appointment of an investigative commission into the merger of Orlen and Lotos. “I will be happy to appear before such a committee,” he announced. However, he warned that this would involve secret agreements. “I’ll do it, but Vladimir Putin will be very happy because we will be talking about contracts loaded with clauses. (…) I am calm, but if someone wants to play a game with the country’s security, please do so,” he said. “Has anyone seen the contract for the sale of Ciech, contracts related to highways? Such agreements are not publicly disclosed because you lose credibility and a business partner,” he said.
Investigation following notifications
The spokeswoman of the Płock District Prosecutor’s Office, prosecutor Iwona Śmigielska-Kowalska, informed PAP on Tuesday that the investigation into the merger of Orlen (then PKN Orlen) with Grupa Lotos in 2022 was initiated after the notifications were submitted.
“An investigation was initiated into the abuse of powers and failure to fulfill duties by members of the management board of PKN Orlen, as well as other persons dealing with the property matters of this company, in connection with conducting negotiations, setting conditions and signing agreements regarding the merger of PKN Orlen with Grupa Lotos in Gdańsk, and then signing agreements related to the sale of shares to Saudi Aramco, which caused significant damage to PKN Orlen in the amount of no less than PLN 4 billion,” prosecutor Śmigielska-Kowalska told PAP.
She added that the decision to initiate these proceedings was issued on January 22. She noted that one of the topics “will be to investigate possible abuse of powers and failure to fulfill obligations by persons supervising the merger process, for example the President of the Office of Competition and Consumer Protection.”
The spokeswoman of the Płock District Prosecutor’s Office explained that the investigation was initiated after notifications submitted, among others, by politicians, including KO MP Agnieszka Pomaska. At the same time, she pointed out that after the notifications were accepted, verification activities were carried out because it was necessary to specify in detail the circumstances to which they concerned.
It started in 2018
The company signed a letter of intent regarding the commencement of the process of taking over capital control by Orlen (then still called PKN Orlen – the name Orlen was introduced in July 2023) over Grupa Lotos with the then Ministry of Energy in February 2018. In June 2022, Orlen received from European Commission consent to the merger with Grupa Lotos, and the management boards of both companies agreed and signed the Merger Plan. A necessary condition for finalizing the transaction was the consent of the shareholders of Orlen and Grupa Lotos regarding the terms of the merger, which happened in July 2022.
Earlier, in January 2022, in accordance with the requirements of the European Commission, Orlen presented remedial measures planned in connection with the takeover of Grupa Lotos. Then it was reported, among other things, that it was Hungarian MOTH will take over 417 gas stations of the Lotos Group network in Poland, while Orlen will buy 144 gas stations in Hungary and 41 gas stations in Slovakia from MOL. The area of fuel and asphalt logistics within the Lotos Terminale company will be purchased Unimot. Whereas Lotos Biofuels the company will buy Rossi Biofuel.
Orlen then emphasized that it had negotiated at the same time with Saudi Aramcothat he will buy 30 percent. shares of the Lotos Group refinery in Gdańsk and agreed a long-term contract for deliveries from PLN 200,000. up to 337 thousand barrels of oil per day, while the target volume of supplies of Saudi raw material should be 20 million tons per year. The company estimated that these supplies could meet up to 45 percent. total demand of the entire Orlen Group – after the takeover of Lotos – both in Poland, Lithuania and the Czech Republic.
At the beginning of August 2022, Orlen announced that the District Court for Łódź-Śródmieście in Łódź, 20th Commercial Division of the National Court Register, registered its merger with Grupa Lotos.
Crucial for Poland’s security?
Recently, Orlen reported that the merger with Grupa Lotos was “key to strengthening Poland’s raw material and fuel security.” The company also assured that as a result of the merger, the State Treasury did not lose its influence on the operations of domestic refineries. According to the company, “the foundation of the merger of Orlen with Grupa Lotos is the agreement with Saudi Aramco”, which means strengthening the relationship “with a stable partner, the largest fuel company in the world, with extensive experience and technologies”, which enables “further dynamic development of the merged company”.
In a statement, Orlen emphasized that the valuation and sale of Lotos’ assets took place on market terms, the valuations were prepared by independent external advisors, and the entire process was carried out in compliance with the law, and the transaction was approved by the European Commission. The company recalled that the valuations were also accepted by the shareholders of both companies, Lotos and Orlen.
“In particular, in this context, it is inappropriate to use the book value of Grupa Lotos as a reference point, which has nothing to do with the market value of the company. At the time when Orlen was finalizing the merger with Grupa Lotos, approximately 150 companies on the Stock Exchange were valued below their book value” – it was noted, among others, in the company’s statement.
On Tuesday, during a press conference, KO MP Agnieszka Pomaska emphasized that by initiating an investigation into the merger of Orlen with Grupa Lotos, “the prosecutor’s office says directly that significant property damage could have been caused to PKN Orlen, not less than PLN 4 billion.” She emphasized that “notifying the prosecutor’s office is just the beginning.”
Insecurity. But the prosecutor’s office may be enough
“No matter will be swept under the carpet, and this particular case is truly outrageous because it has exposed the State Treasury not only to financial losses, but has exposed the State Treasury and all of us to fuel insecurity in the face of a serious threat taking place right on our borders. These are very serious accusations and I have no doubt that today the prosecutor’s office may feel that no politicians, neither the ruling party nor the opposition party, will pressure them. They will only expect the prosecutor’s office to do what it was established to do. – Pomaska emphasized.
Prime Minister Donald Tusk, asked on Tuesday whether it would be good if, apart from the prosecutor’s office, the matter of the Orlen-Lotos merger was also clarified by an investigative commission, he replied that he was not interested in “investigating” Poland. “There is probably a lot of material from the Supreme Audit Office and material resulting from the analyzes of the secret services, so maybe there will be no investigative commission and maybe the classic actions, i.e. the prosecutor’s office and disclosure, will be enough,” said the head of government.
“I would really like people to see, as much as possible, what was happening there, not only in Orlen, but in other companies. Perhaps an investigative commission is not needed for this, only on the one hand the prosecutor’s office, and on the other hand, a simple, quick audit,” added the Prime Minister. According to him, audits in companies will provide a lot of public information and then it will be clear whether an investigative commission is needed or not. (PAP)
author: Anna Bytniewska
