Polish state-controlled Tauron will buy the Brzeszcze coal mine with or without shareholder consent, the CEO of the listed utility insisted on November 12.
Tauron is looking to buy the asset from SRK, the Polish state vehicle for restructuring the struggling coal industry. Brzeszcze was moved to the fund from Kompania Weglowa earlier this year, as the government raced to bail out the state holding, which is Poland’s largest miner.
The outgoing government of Civic Platform (PO) has been trying to organise a rescue for months. The plan was based on pushing the country's state-controlled utilities and energy companies into investing in the sector, which is seeing losses mount as it grapples with low market prices and inefficient production.
However, Warsaw has been forced into desperate measures, after the "saviour" companies made it clear they were unwilling to embark on investments they insist make little economic sense. Tauron had been the only company to show willing, agreeing in May to take over Brzeszcze.
Yet it soon began backing off. The government sacked the management team over its lack of enthusiasm for the plan in early October.
The new company heads plan to raise capital via a PLN400mn (€94.5mn) share issue to power the deal. However, shareholders in the listed utility postponed a decision on the issue until November 23, citing the need to analyse it in early November.
"[The purchase and the share issue] are two separate issues: we will buy Brzeszcze even without the consent of shareholders for a share issue," CEO Jerzy Kurella told PAP on November 12.
Tauron agreed the terms of purchase in mid-October. The deal will also need approvals from the treasury, competition watchdog UOKiK, and the ministry of environment.
Poland’s new government of Law and Justice (PiS) will soon need to face the issues around the ailing mining sector. It has blasted the outgoing PO cabinet over its failures in recent month, but has few alternatives but to follow a similar plan. It has already hinted the country's listed energy giants will be asked to help out.
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