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Wednesday, February 28, 2024

Orlen – Lotos. Paweł Olechnowicz, former president of Lotos, on the merger of Orlen with Lotos and Saudi Aramco

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Lotos’ assets “were transferred into dangerous hands when it comes to Poland’s energy security,” said Paweł Olechnowicz, former president of Lotos, in “Fakty po Faktach” on TVN24. In his opinion, the merger of Orlen with Lotos was not carried out transparently. – The government’s erasure of the name of the company (Lotos – ed.), one of the best listed companies on the Polish market, from the economic map of the country is something that does not qualify for any quasi-positive assessment, it is tragic – emphasized Olechnowicz.

In July 2023 Supreme Chamber of Control prepared a report regarding, among others, merger of Orlen with Lotos after inspection by the Ministry of State Assets. “Black and White” journalists Łukasz Frątczak and Dariusz Kubik found the still unpublished document. According to the Supreme Audit Office, Saudi Aramco paid PLN 7.2 billion less for the Lotos part than it was worth.

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Paweł Olechnowicz about the merger of Orlen and Lotos

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– This is one of the largest economic transactions in Poland, made on state assets. Therefore, it is also made by the government, so it must be very transparent, legible, checked not only by various companies, security and business organizations, but also socially accepted. Nothing in this regard – as far as we know – has been done transparently, even though the other side defends itself and says that everything was in accordance with the law and the principles of operation of this type of economic ventures. It’s not true, it’s not good for Poland – said Paweł Olechnowicz, former president of Lotos, who headed the company in 2002-2016, in “Fakty po Faktach” on TVN24.

Olechnowicz drew attention to the statements of politicians who defend the transaction. – (…) me, who spent years creating and expanding Grupa Lotos, building value for the Polish economy, with people, with employees, with management, which brought very interesting results to Poland, erasing the name of the company, one of the best listed companies on the Polish market, from the government’s economic map of the country, this is something that does not qualify for any quasi-positive assessment, it is tragic – he said.

In his opinion, Lotos’ assets “were transferred into dangerous hands when it comes to Poland’s energy security.” – Saudi Aramco is the king’s company, in very good relations with Russia and (Vladimir) Putinalso in good terms with Hungary – said the guest of “Fakty po Faktach” on TVN24. As he said, “this is a direction aimed at reducing Poland’s energy security and creating such targeted actions that can be taken by Saudi Aramco without our being able to react decisively, because Saudi Aramco has the right to veto, so it also has the right, as a global company, to make transactions.” without the consent of others in this market.

The former president of Grupa Lotos was asked whether Poland had freed itself from Russian oil. – I don’t know, it would have to be checked. Saudi Aramco is the largest company in the world and is guided by the mechanisms that operate and apply to it on the global market, not on the Polish or Arab market. As a global concern, they can make exchanges and swaps, which will suit them better for business relations and achieve better economic results. They can also sell diesel oil produced in our country in Europe and earn more, while we will have to import it and pay more – he noted.

“You couldn’t even try to do it”

Olechnowicz was also asked whether it was worth undoing this transaction. – It is certainly worth taking a closer look at why this happened, what was the reason for this type of change in the ownership arrangement and the creation of a conglomerate from the point of view of business, economic, social, political and energy security of the state. I think that all these parameters that will be affected will create a negative image of this entire transaction. You couldn’t even try to do it – said the guest of “Fakty po Faktach” on TVN24.

The former president of Lotos did not want to directly refer to Daniel Obajtek’s business career.

– We have reduced the value of the human individual on the Polish market, and in the functioning of not only the economy. A person has a different value, he is less needed. Voters are needed more, a declaration of support for the ruling party is needed more – that was the case – and for this purpose various mechanisms are being created to strengthen this type of narrative – he explained.

– Therefore, it is less important who will rule in terms of its quality. The person who comes is put in a very serious position, it is important that he fulfills this political obligation. (…). This cannot be the case, our state system is broken and needs to be repaired, emphasized Paweł Olechnowicz.

Orlen comments on the Supreme Audit Office’s findings

Orlen commented on the Supreme Audit Office’s findings. The Płock company said in a statement on Monday that the sale of part of Lotos’ assets was carried out in accordance with the market valuation of these assets. Orlen’s press office reported that “the valuation and sale of Lotos’ assets took place on market terms.”

Orlen also assured that as a result of the merger with Lotos, the State Treasury “has not lost its influence on the operations of Polish refineries.” It was added that “70 percent of shares in the company operating the refinery in Gdańsk remained in the hands of Orlen, which has a decisive influence on corporate decisions in the company.”

According to the company, the countermeasures accompanying the merger with Lotos did not pose a risk to Poland’s fuel security. It was emphasized that the basis for the merger of Orlen with Grupa Lotos is the agreement with Saudi Aramco, which “effectively secures the interest and ensures Poland’s fuel security.”

In the statement, Orlen also commented on allegations that the joint venture agreement has veto rights. “Each, without exception, joint venture agreement lists matters that can only be decided jointly – it is mainly for this purpose that such agreements are concluded,” we read in the statement. It was also assured that the contract with Saudi Aramco stipulated that the minority shareholder’s rights “may not lead to paralysis of operations or harm to the entity’s profits.”

Main photo source: TVN24

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