By Patryk Wasilewski
WARSAW--Poland's state-controlled companies Grupa Lotos SA
(LTS.WA) and Grupa Azoty SA (ATT.WA) want to build a 12 billion
zloty ($3.9 billion) petrochemical plant as part of the
government's plan to strengthen national champions.
Despite years of privatization, the Polish government still
plays a major role in a number of industries, controlling companies
ranging from mining to refining to airlines.
Seeking ways to give the economy a boost, the government has
turned away from its pre-crisis declarations of continuing asset
sales while keeping only a handful of companies it sees as
strategic. It has adopted a more hands-on approach that focuses on
strengthening the state companies it still has and using them to
start new projects, mostly in heavy industries.
The two companies, Lotos and Azoty, signed a deal Tuesday to
conduct a feasibility study for a petrochemical plant to be located
near Lotos' refinery with the chemical group Azoty the main
customer.
The companies have up to PLN750 million tentatively available in
financing from the government's investment vehicle, Polskie
Inwestycje Rozwojowe.
"I am very pleased with this project," Treasury Minister
Wojciech Karpinski said after the signing ceremony. "It clearly
fits what I've been promoting for last six months--building
synergies between our national champions in order to strengthen
their position and allow an international reach."
Polish industrial heavyweights have tried to cooperate with each
other. Power utility Tauron Polska Energia SA (TPE.WA) and gas firm
PGNiG SA (PGN.WA) are on track with their plan to jointly build a
gas-fired plant in Stalowa Wola. But some other state-controlled
companies have dropped similar plans in other locations.
Last year Prime Minister Donald Tusk said the government wants
the corporate sector to increase its investment drive, making up
for weak public investments in the face of public spending
limits.
In order to make financing of such ventures easier, the
government set up the PIR investment vehicle, which has only signed
one financing deal--with the Lotos refinery.
The Polish government recently ordered the country's largest
power utility, Polska Grupa Energetyczna SA (PGE.WA), to go ahead
with a PLN11.5 billion coal-fired power plant despite concerns by
the company's management that the project would not be
profitable.
Write to Patryk Wasilewski at patryk.wasilewski@wsj.com