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Orlen SAOrlen's shareholders misled by inclusion of synergies in merger settlement with Lotos - NIK
The inclusion of potential synergies in the settlement of the final value of Poland's largest lender by assets Orlen's acquisition of petrol giant Lotos misled the public and shareholders, the head of Poland's supreme audit office NIK Marian Banas told a presentation of the supplementary report on the merger.
The head of Poland's supreme audit office stressed that NIK found that the merger of the two oil industry giants lacked sound economic justification from the outset.
"The key point of our findings is that the transaction was made for an amount by PLN 5 billion below market value (...). Furthermore, in order to give the transaction a semblance of viability, Orlen, when presenting the results of the merger, forecast future uncertain synergies at PLN 10 billion," Banas said.
"These projections were flawed because they were based on uncertain data. The inclusion of these potential synergies in the settlement of the final transaction value misled the public and shareholders," he added.
NIK's head pointed out that as a result of this merger, Poland's State Treasury lost influence over around 20 percent of the refinery products market.
"[It] was less able to control the country's key energy resources, creating a clear risk to our fuel security," he stressed.
Banas emphasised that Orlen had spent more than PLN 200 million (EUR 46.8 mln) on external advisors instead of taking the help of the Attorney General's Office.
According to the report, the divestment of Lotos' assets as part of the EC remedies took place well below their value and synergies did not materialise.
jz/ ao/ han/
