Russia's Acron responds to growing opposition to ZAT bid

04 June 2012 16:47  [Source: ICIS news]

LONDON (ICIS)--Russia's Acron Group has called on shareholders in Zaklady Azoty Tarnow (ZAT) to recognise that it is the right strategic investor for the Polish chemical group despite growing opposition to its bid, the mineral fertilizer producer said on Monday.

“In combining with the Acron Group, the ZAT Group would gain access to a [cheap] raw material base, an extensive network of logistics and sales, as well as access to new technologies and business experience in the international market,” said Acron vice president Vladimir Kantor.

“We believe that our offer to purchase shares is attractive to ZAT shareholders,” he added.

However, the management board of ZAT, Poland's largest chemical producer by revenue, has stepped up its resistance to Acron's zlotych (Zl) Zl1.5bn ($422.5m, €340.1m) for 66% of the company.

It issued a statement stating that the board was “strongly” against the offer as it does not take into account the fair value of the company or incorporate its long-term strategy.

Looking at the latest developments, Prague-based investment bank Wood & Company concluded that Acron's is “highly unlikely” to be successful in its bid for a majority stake in ZAT, a producer of nitrogen and multi-component fertilizers, caprolactam (capro), polyamide 6, oxo-alcohols, plasticisers and titanium dioxide (TiO2) which is controlled by voting rights held by the Polish treasury ministry.

“According to ZAT's management, the proposed price does not reflect the potential synergies to be unlocked upon the takeover and threatens the execution of the ZAT group's market consolidation strategy,” the bank said in a note to investors.

“Also according to management, uncertainties include the further development of the construction polymers segment, oxo-alcohols and plasticizers, and TiO2. The abandonment of, or limited investment in these products, would, in management’s opinion, be detrimental to the development of the group,” it added.

Shareholders have been invited by Acron to accept its offer in a bid window that runs from 6 June to 22 June.

($1 = €0.81)
($1 = Zl 3.55, €1 = Zl 4.41)


By: Will Conroy
+44 20 8652 3214

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