Press releases

The General Meeting of Ciech has decided to issue nearly 1.7 million new shares to be acquired by the State Treasury in exchange for a contribution in kind comprising minority stakes at ZCh Organika-Sarzyna, ZCh Zachem and ZCh Alwernia. The shareholders approved the duties performed by the Management Board and the Supervisory Board and appointed the Supervisory Board for a new term of office.

The Ordinary General Meeting adopted a resolution on an increase in the share capital by issue of 1 699 909 million shares at PLN 26.06, as a result of which the share capital of Ciech will be increased by PLN 8 499 545, i.e. up to PLN 263 500 965. In consideration of the new issue shares, Ciech will receive 5.15 percent of shares of Zakłady Chemiczne Zachem, 5.06 percent of shares of Zakłady Chemiczne Organika-Sarzyna and 25.01 percent of shares of Zakłady Chemiczne Alwernia which are currently owned by the State Treasury. The completion of the capital increase and the introduction of the new issue shares into trading on the Warsaw Stock Exchange are to take place in the third quarter 2011.

– The acquisition of minority stakes without spending cash, in exchange for a relatively small block of our shares, is a favourable operation for both, the company and its shareholders. The Ciech’s capital has increased and at the same time we settle the liabilities assumed at the time of acquisition of Zachem and Organika-Sarzyna companies, and we increase our control over Alwernia – said Ryszard Kunicki, President of Ciech. – In this way, we organise our assets and improve the transparency and clarity of the Group – he added.

In accordance with the contracts for purchase of ZCh Zachem and ZCh Organika-Sarzyna entered into in 2006, Ciech was obliged to repurchase from the State Treasury minority blocks of shares of both companies. For this purpose, the company submitted irrevocable offers for acquisition of minority stakes at Zachem and Organika-Sarzyna companies, the validity of which expires in 2016. In accordance with the said contract, the Ministry of State Treasury was entitled to accept the offers at any time and demand Ciech to repurchase the minority stakes for cash accounting for more than PLN 26 million. The purchase of minority stakes at Organika-Sarzyna, Zachem and Alwernia would result in a considerable outflow of funds necessary to the company during reorganisation. Therefore, the Management Board of Ciech has been looking for the most favourable solution for a long time. The issue of shares for a contribution in kind was the outcome of such works.

The acquisition from the State Treasury of 25.01 percent of shares of ZCh Alwernia SA (PLN 18 332 741.56) may considerably improve the divestment process at the company so that it will be implemented during one stage. To date, according to the Articles of Association of ZCh Alwernia, an investor acquiring a block of more than 32 percent of shares of the company (Ciech holds 73.75 percent) would have to make the same offer to the State Treasury which makes the entire transaction more complicated. The acquisition of all shares will simplify the process.

As a result of the issue of shares for a contribution in kind, the stake of the State Treasury in Ciech will increase by 2.04 percentage points up to 38.74 percent. The Management Board of Ciech entered into an agreement concerning actions aimed at implementation of the transaction with the State Treasury on May 26th. On June 6th the Council of Ministers agreed to transfer to Ciech 25.01 percent of capital (571 826 shares) of Alwernia as a contribution in kind to cover the shares in the increased share capital of Ciech acquired by the State Treasury. Earlier, Ciech acquired the necessary corporate permits and permits of financial institutions.

The Thursday’s Ordinary General Meeting unanimously approved the duties performed by all members of the Management Board and Supervisory Board of Ciech. At the same time, the shareholders appointed the Supervisory Board for a new term of office in its current composition.