Macedonian securities watchdog rejects takeover bid for Makpetrol

Macedonian securities watchdog rejects takeover bid for Makpetrol
By Valentina Dimitrievska in Skopje January 14, 2018

Macedonia’s Securities Commission has rejected the takeover bid placed by offshore company Balkan Petroleum Holding for the country’s biggest fuel retailer Makpetrol as it was non-transparent, Makpetrol said on January 12.

The planned takeover sparked many concerns in Macedonia as little is known about London-registered Balkan Petroleum Holding, which was set up less than two weeks before it announced its intention to take over Makpetrol.

Balkan Petroleum sought approval from Macedonia's Securities Commission in July 2016 to place a bid to take control of Makpetrol for €47mn. According to Reuters, the company is owned by Russian investors Alexander Kaplan and Alexander Smuzikov. 

“The commission concludes that the legal requirements for the takeover bid were not fulfilled, as the prospectus and the takeover bid were not prepared in accordance with the law,” the commission said in a statement. The decision was made on December 29.

According to the legal requirements, shareholders of the target company must be fully, accurately and in a timely fashion informed about the takeover bid in order to have sufficient time to properly evaluate it, the statement said. This was not the case with Balkan Petroleum Holding’s bid.

Therefore, the securities watchdog decided not to allow Makpetrol to be taken over “in the lack of all the necessary and relevant data from Balkan Petroleum”.

Makpetrol said in a bourse statement that the company’s management was informed of the takeover bid on June 8, 2016, and that it informed relevant institutions that the bidder was set up on May 28, 2016 with capital of only €1,000.

During the procedure that lasted more than 18 months, Makpetrol’s management did not make any contact with Balkan Petroleum Holding.

Macedonia’s Securities Commission in September 2016 temporarily halted the procedure for approving the takeover bid for Makpetrol due to an unresolved issue related to the activities of another state body. Since then, no other action has been taken by relevant authorities, until the latest statement for the bid’s rejection.

Last September, Makpetrol’s CEO, Andrea Josifovski, told broadcaster Telma that the company’s management had plans to take action against local institutions for what managers say was their unlawful handling of the takeover bid launched by the offshore company.

The EU's Energy Community secretariat also raised concerns about the impact that the planned takeover would have on the security of gas and fuel supply in the country.

Makpetrol directly employs over 1,800 people. It has approximately 130 filling stations and reported annual sales growth of 14% with net profit of MKD202mn (€3.3mn) in the first nine months of 2017. Aside from Telma, Makpetrol controls other three companies: gas transmission system operator GAMA, fuel wholesaler Makpetrol Prom-Gas and trade company Sampion.