2019-08-07 20:14 update: 2019-08-14, 20:30
Photo PAP/Tytus Żmijewski
The European Commission has opened an in-depth investigation to assess the proposed acquisition of Lotos by PKN Orlen, under the EU Merger Regulation, the EC wrote in a Wednesday press release.
According to the statement, at this stage the Commission is concerned that the proposed transaction would reduce competition in several markets where the merged entity would be active. In particular, the Commission is concerned that the proposed transaction could lead to higher prices and less choice for business customers and end-consumers of several products, especially at fuel stations and airports.
"The proposed acquisition of Lotos by PKN Orlen would affect several strategically important energy markets. The Commission will investigate whether the proposed acquisition would reduce competition and lead to higher prices for, or less choice of, fuels and related products for business customers and end consumers in Poland and other Member States," Commissioner Margrethe Vestager, in charge of competition policy was quoted in the press release as saying.
The Commission will now carry out an in-depth investigation into the effects of the transaction to determine whether its initial competition concerns are confirmed. The Commission now has 90 working days, until 13 December 2019 to take a decision.
The takeover of the Lotos Group by Orlen was initiated in February 2018. Orlen filed a preliminary motion for EU approval for the Lotos merger in November 2018.
Orlen expects the potential merger with Lotos to boost its investment potential. In the company's view "completing the transaction will translate into higher investment possibilities, among others in the field of asset development or foreign expansion."
The state-owned fuel conglomerate PKN Orlen is the largest entity in the refining and petrochemical industry in Poland, strategic for the country's energy security and one of the largest in this sector in Europe. (PAP)
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