Orlen offers to buy all shares of Grupa Azoty Polyolefins for $278 million (updated)

Grupa Azoty SA

15/10/2025 06:45

Recasts with value in first paragraph, updates with market reaction in paragraph 9

WARSAW, Oct 15 (Reuters) - Polish oil refiner Orlen PKN.WA said on Wednesday it has offered to buy all shares of Grupa Azoty Polyolefins (GAP), a petrochemical unit of state-controlled chemical group Grupa Azoty ATTP.WA in a deal valued at 1.02 billion zloty ($278 million).

Orlen, which currently owns a 17.3% stake in GAP, said its offer includes financing to restructure GAP's debts and claims, as well as funds to purchase shares from the other shareholders.

Azoty, which is struggling with losses at its core fertiliser business, and Orlen have been discussing options for the chemical maker's polymers business since 2024.

Earlier this year, the country's top oil refiner said it would not buy more shares in Azoty's polymer production project. Nonetheless, the companies signed a memorandum of understanding on the sale of logistical assets of GAP.

Orlen said on Wednesday that the offer is valid till the end of the year, and is contingent on completion of restructuring proceedings of GAP and on the final settlement of the contract to build the polypropylene plant.

The contractors of the project that has been delayed and not fully completed are Hyundai Engineering Co and the Korea Overseas Infrastructure & Urban Development Corporation.

While analysts said the deal aligned with Orlen's strategy, adding that the price was not significant, Jonathan Lamb at Wood & Co cautioned about persistently low margins in  petrochemicals.

"I do not expect investors to be positive on the announcement. Petrochemical margins have been poor for some time and are likely to remain poor," Lamb told Reuters.

The announcement triggered a positive market reaction for Grupa Azoty, with its shares jumping as much as 5.2%. Orlen's stocks, however, traded flat as investors assessed the impact of the acquisition.

($1 = 3.6664 zlotys)

 (Reporting by Marek Strzelecki, additional reporting by Julia Kotowska and Alicja Surdy in Gdansk; Editing by Mrigank Dhaniwala, Emelia Sithole-Matarise and Jacqueline Wong)

 ((Marek.Strzelecki@thomsonreuters.com;))