Poland's ZAP must take over ZAT, not vice versa - workers' council

07 August 2012 15:03  [Source: ICIS news]

LONDON (ICIS)--The Workers' Council of Poland's Zaklady Azotowe Pulawy (ZAP) has called on the Polish treasury ministry to request that ZAP takes over fellow state-controlled chemical group Zaklady Azoty Tarnow (ZAT) rather than vice versa, the council said on Tuesday.

In a letter to treasury minister Mikolaj Budzanowski, the council, a statutory advisory and consultative body which functions on behalf of all of ZAP's 3,500 workers, said: “Given ZAP's market position and financial health, we believe it should be the dominant partner in the merger-consolidation, and at the very least an equal partner in the process.”

ZAP is a far more dynamic company than ZAT, having successfully become the domestic market leader for nitrogen fertilizers, melamine and urea solutions, the letter added.

Analysts say the “mega-merger” between ZAT and ZAP will create a “major league” Polish chemical player.

The treasury ministry, which said it would respond to the council's request in due course, has for the past two years relied on ZAT to lead the further consolidation of the remaining major state-controlled assets in Poland's chemical industry.

Efforts in recent years to privatise ZAT and ZAP have failed due to low bids but the ministry hopes the companies can be successfully sold off once they have been consolidated.

The ZAT group, headquartered in Tarnow, southern Poland, produces nitrogen fertilizers, multi-component fertilizers, caprolactam (capro), polyamide 6 (nylon 6), titanium dioxide (TiO2), oxo-alcohols and plasticisers.

ZAP, based in Pulawy, eastern Poland, is largely a producer of nitrogen fertilizers, melamine and caprolactam (capro).

By: Will Conroy
+44 20 8652 3214

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