Polish chemicals and fertilizer major Grupa Azoty has signed a preliminary agreement to sell 100% of GA Polyolefins to Orlen in a cash-free, debt-free transaction valued at PLN 1.183 billion. The deal marks a key milestone in stabilizing the Polish chemical giant’s finances.
The breakthrough follows a settlement with Hyundai Engineering Co., a former shareholder of GA Polyolefins, which involved the mutual withdrawal of claims at the Vienna International Arbitral Centre, alongside the earlier termination of the shareholders’ agreement.
“Resolving the Polimery Police Project is a turning point for Grupa Azoty and addresses one of our most significant investment and financial challenges. By transferring the project to a partner with strong downstream petrochemical capabilities, we are relieving the organisation of part of the debt that has been limiting our operational flexibility.
"This transaction is a catalyst for implementing our new strategy—focusing on our fertilizer foundation and maximising synergies within the Group. One further milestone remains ahead, which will allow us to move from defensive debt management to active value creation for the Group,” said Marcin Celejewski, President of the Management Board of Grupa Azoty.
Under the agreement, Orlen will inject capital to implement the arrangement and repay liabilities outside the deal. The company will also provide GA Polyolefins with a loan to maintain liquidity during the transition.
The transaction features an earn-out mechanism, giving selected stakeholders, including Grupa Azoty Police, a share in potential future profits. Orlen is responsible for paying the earn-out. Post-sale, Grupa Azoty companies will continue commercial relationships with GA Polyolefins on market terms, generating revenues mainly for Grupa Azoty Police and the Port of Police Authority.
“The positive outcome of the arrangement vote is a milestone that opens the way for the entry of a strategic investor and concludes complex negotiations. Thanks to the engagement of all parties, the process has entered its decisive phase at this stage, the key step is the court’s approval of the arrangement.
"This solution makes it possible to avoid bankruptcy, ensuring the region’s economic security and the stability of jobs,” said Małgorzata Królak, President of the Management Board of GA Polyolefins.
