Poland's integrated Orlen has offered just over 1bn zlotys ($285mn) to buy a 437,000 t/yr propane dehydrogenation (PDH) and polypropylene (PP) plant from country's chemical firm Grupa Azoty.
Orlens offer is 1.022bn zlotys for the PDH/PP plant and infrastructure including a sea terminal for imports of propane and exports of polypropylene.
The offer requires Azoty to complete a debt restructuring and settle potential claims related to that, including from a dispute with the plant's general contractor Hyundai Engineering.
Azoty has confirmed receiving Orlen's offer, and said it will respond in due course.
Orlen and Azoty have been in on-off talks about the PDH/PP plant since September 2024. Orlen's offer is lower than some analysts expected. Shares in Orlen and Azoty rose slightly at the start of trading on the Warsaw stock exchange today, indicating that investors do not see the offer as major burden for the oil company, according to analysts.
The PDH/PP plant has become a burden for Azoty, which as of the end of June had debt of 4.6bn zlotys, mostly related to funding the plant's construction, to a consortium of banks. The plant, in Police near Szczecin, was developed at a cost of nearly $2bn.
Azoty suspended production from the plant earlier this year following a malfunction in the PDH unit. It has said at completion and successful commercial operation of the plant is beyond its financial capabilities.
Orlen said its offer is valid until end of this year and potential completion of the deal is expected by the end of June 2026.
Orlen is already a minority shareholder in the company operating the PDH/PP plant, with a 17pc stake.
