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The European Commission authorises Orlen to take over Energa

The European Commission (EC) has allowed, under the EU Merger Regulation, the oil and gas group PKN Orlen to acquire the power company Energa as the two Polish companies’ activities have limited overlaps. In December 2019, PKN Orlen (27.5% owned by the State of Poland) presented a plan to take over Energa with the objective to strengthen its positions in the electricity market and to close the acquisition by mid-2020. PKN Orlen will offer PLN 7 (€1.5) per share, valuing Energa at PLN 2.9bn (€635m). Due the coronavirus epidemic, PKN Orlen has extended the subscription period for Energa shares in its takeover bid from 9 April 2020 to 22 April 2020.

PKN Orlen is Poland largest wholesale supplier of oil products (57% market share in 2018). It operates a large refinery in Płock with a capacity of 16.3 Mt/year, which processed and sold around 15 Mt of oil products in Poland in 2018. The company is active on the wholesale and retail markets for refined oil products in Austria, the Czech Republic, Estonia, Germany, Latvia, Lithuania, Poland and Slovakia, and in the generation and wholesale supply of electricity in Poland. Energa (51.5% owned by the State of Poland) is active in power generation, distribution and sales activities in Poland. In 2018, it operates around 1.3 GW, generated 4.3 TWh, distributed 22 TWh to 3 million electricity and heat customers and sold 20 TWh of electricity. In consortium with ENEA, the company is currently developing the 1,000 MW Ostrołęka-C ultra-supercritical (USC) coal-fired power project that is planned to be commissioned in the second half of 2023. The previous government planned to merge Energa with state-owned power producer PGE but the proposed merger was postponed until the restructuring of the coal sector.

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