25 May 2010 13:43 [Source: ICIS news]
PRAGUE (ICIS news)--Ciech has drawn up a plan to dispose of two of its four divisions, Poland's largest chemical maker said on Tuesday.
The restructuring would see the group sell fertilizer and other assets in its agrochemial division and also seek buyers for its silicates & glass units, it added.
This would leave Ciech with its two largest divisions, soda ash and organic chemicals, which generate around 70-80% of its revenue and two thirds of its earnings, before, interest, tax, depreciation and amortisation (EBITDA), the company said.
Two weeks ago, Ciech announced it was in talks with Poland’s Zaklady Azotowe Tarnow (ZAT) over ZAT’s possible acquisition of the Fosfory Ciech phosphorous fertilizer unit in the Baltic sea port city of Gdansk in northern Poland. The subsidiary has an annual fertilizer capacity of 400,000 tonnes.
Subject to board approval, Ciech's plan to switch to two divisions will also see it put other assets up for sale, including a 73.75% stake in nitrogen phosphorus potassium (NPK) fertilizer producer Alwernia and glass and silicates subsidiary Vitrosilicon.
Ciech is attempting to restructure and pay down debts to obtain the treasury ministry’s permission to restart its privatisation.
This was postponed earlier this year when the treasury insisted the company should reach an agreement with a group of banks on refinancing its major loans before continuing with the process.
A deal with the banks was struck in April, but analysts have noted a key condition of the agreement has left Ciech under pressure to reduce its debt by Zl 400m ($123.5m, €99.5m) by the end of March 2011.
Ciech said it aims to meet the condition with capital raised from asset sales and possibly from an initial public offering (IPO) of shares in its soda ash division and a bonds issue.
($1 = Zl3.24, €1 = Zl4.02)
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