Acron extends ZAT bid deadline, possible counter-bid anticipated

15 June 2012 13:31  [Source: ICIS news]

LONDON (ICIS)--Russia's mineral fertilizer producer Acron Group has extended the deadline for shareholders to accept its offer for their holdings in Polish chemical group Zaklady Azoty Tarnow (ZAT) from 22 June to 29 June, Acron said on Friday.

“We've conducted numerous interviews and meetings with shareholders [and] we can see that many of them need additional time to make a decision, so we've opted to extend the duration of the share call,” said vice president of Acron Vladimir Kantor.

On Thursday, Acron criticised the Polish treasury ministry, which has a controlling holding of 32% in ZAT, for recommending shareholders refuse its offer, amounting to (Zl) Zl 1.5bn ($441m, €349m) for 66% of ZAT, as too low.

The offer was a response to Poland's 2012-2013 privatisation plan and the treasury had dismissed it without having even conducted negotiations on what investor guarantees could be offered, Acron said.

The ministry has stated it believes Acron ownership could disrupt the growth strategy of ZAT, a producer of nitrogen and multi-component fertilizers, caprolactam (capro), polyamide 6, oxo-alcohols, plasticisers and titanium dioxide (TiO2).

The question now is whether a counter-offer from a “white knight” bidder might be submitted and on what price terms, said Wood & Company investment bank analyst Piotr Drozd.

“At this point, with the strategy argument in hand, it seems that the political impact, and not the price, will be the state treasury’s key focus,” said Drozd.

“Without the treasury’s consent, and with counter-bids expected, it should be difficult for Acron, if not impossible, to achieve the targeted 50% (+1 share) minimum threshold [for a successful bid], even assuming a tender price hike to the current stock price level,” he added.

($1 = €0.79)
($1 = Zl 3.40, €1 = Zl 4.30)

By: Will Conroy
+44 20 8652 3214

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