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PGE submitted final non-binding offer for the acquisition of Energa S.A.

  • No. of the report: 47/2010
  • Report date: 16.08.2010
  • Report legal ground: Art. 56 section 1 p. 1 of Act on Public Offering – confidential information

Contents of the report

The Management Board of PGE Polska Grupa Energetyczna S.A. ("PGE") hereby informs that on August 16, 2010 it submitted the final, non-binding offer (the "Final Offer") for the acquisition from the State Treasury (the “Seller”) of 4,120,000,000 shares (the "Shares") of Energa S.A., a company with its registered office in Gdańsk ("Energa"), constituting 82.9 % of its share capital (the "Transaction"). The Final Offer, despite its non-binding nature, will constitute a basis for negotiations to be conducted with the Seller.In the opinion of the Management Board of PGE, PGE and Energa uniquely complement each other and jointly generate a significant synergies' value.The following areas of the synergy have been identified within the Transaction: strategic, investment plan and cost-related synergies. The value of the cost-related synergies estimated by PGE that are quick to achieve without the necessity for a deeper integration of the companies exceeds PLN 100 million per year.PGE has conducted a reasonable assessment of Energa's potential proposing through the Final Offer the conditions maximising value both for PGE and its shareholders.The offer is fully compatible with implementation of the acquisition strategy on the market which, in this case, is best known to PGE. PGE's organic growth supported by selective acquisitions is aimed at increasing PGE's position as a middle-sized, highly profitable European player.Upon the approval for participation of PGE in the next stage of the Transaction, PGE will proceed to negotiate specific conditions of the agreement with the Seller and will conduct supplementary due diligence study, which will constitute the basis for the decision regarding further steps to be taken in the Transaction, including possible signing of the purchase agreement of the Shares, which execution will be conditional upon obtaining consent of the anti-monopoly authority. Based on the conducted analyses, it is PGE’s opinion that granting by the anti-monopoly authority a conditional consent for the Transaction upon PGE's potential motion and its content, is highly probably. Notwithstanding the above, in PGE’s opinion there are also grounds for granting an extraordinary consent.Legal ground: Art. 56 section 1 point 1 of the Act on public offering, conditions governing the introduction of financial instruments to organised trading, and public companies (Dziennik Ustaw 2009, no 185 item 1439).

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