Enea – Lubelski Węgiel Bogdanka. Enea did not accept the State Treasury’s offer, negotiations are ongoing

Enea received in August 2023 from the State Treasury, represented by the Minister of State Assets Jacek Sasin, an offer to purchase a block of 21,962,189 shares of Lubelski Węgiel Bogdanka at a price of PLN 45 per share. The total amount of the transaction would reach approximately PLN 988.3 million. As reported, in accordance with the offer, the price for the block of Bogdanka shares owned by Enea would be settled in the form of Treasury securities transferred via the Reprivatization Fund.

The Lubelski Węgiel Bogdanka Capital Group is – as we read on the company’s website – one of the largest producers of hard coal in Poland.

In its half-year report published on Thursday, Enea provided new information about the potential transaction.

“The net asset value of CGU Wydobycie (LW Bogdanka) resulting from the obtained price offer is below the book value and is below the fair value of CGU Wydobycie estimated by the management board, and consequently it is not satisfactory and has not been accepted,” Enea wrote in the half-year report.

As indicated, although the current stock price of Bogdanka is around PLN 33 per share, in January this value exceeded PLN 50. “In the opinion of the management board, the above circumstance and the factors given below mean that the use of the current stock exchange capitalization as an indicator of the fair value of LWB is not justified,” it was written.

Therefore, the Management Board estimated the recoverable value of CGU Wydobycie at fair value less disposal costs.

“Taking into account the analyzes carried out and the report obtained on the estimation of the market value of LWB shares (prepared on September 11, 2023 by Pekao Investment Banking), the management board considers a valuation of at least PLN 72.28 per share to be reasonable and, as part of the negotiations, it will strive to to sell shares at a level taking into account this valuation,” Enea said in the report.

– The process is ongoing, we would not like to comment on it excessively. We know the basis for our assessment of the fair value of the securities we own and the assets we have in the Enea group. (…) I assume that the offer we received was largely based on the current value of the exchange rate – said Rafał Mucha, vice-president of Enea, at a press conference on Thursday.

He added that the price volatility is high and, in Enea’s opinion, it cannot be based on a point-by-point reference to the share value at a given moment.

Mucha said that the company is bound by a letter of intent with the State Treasury until the end of 2023, “which shows that we want to sell Bogdanka’s shares.” – The process is ongoing, let it run its course – he emphasized. – We neither accepted the offer nor rejected it. We are in the negotiation process – added the vice-president of Enea.

Bogdanka ended Thursday’s session on the Warsaw Stock Exchange with an increase of 7.42%. The price for a share of the company is PLN 35.90. Enea’s price increased by 1.13%. up to PLN 7.58 per share.