PGNiG to Get $54 Million for Tarnow Stake

Investors have bid 37 zlotys per share for Polish gas monopoly PGNiG's 10% stake in fertilizer producer Azoty Tarnow, four market sources close to the transaction told Reuters on Friday.

The price values the stake at 148 million zlotys ($54 million) and the entire company at 1.45 billion.

Tarnow shares pared some of their earlier losses and traded 2% down from Thursday's close at 37.99 zlotys, while PGNiG shares were up 0.3% to 3.78 zlotys.

PGNiG was not immediately available for comment.

The state-controlled gas monopoly bought its stake in Tarnow for 19.5 zlotys a share in 2008 when, together with Ciech, it stepped in to save Tarnow's privatization process.

At the time PGNiG considered consolidating the chemical industry in Poland, one of its biggest clients, but due to tough conditions in the fertilizer market it decided to abandon the plan and focus on entering the energy market.

"PGNiG took advantage of relatively good sentiment in the fertilizer market and the relatively high price of Tarnow," an analyst said on a condition of anonymity. "I would not be tying this move to the dividend decision."

PGNiG surprised the market on Thursday with its decision to pay all of its dividend in cash, moving away from an earlier plan to pay a part of the proposed 0.06 zloty dividend in kind.

For years PGNiG has paid the state's part of dividend in kind, transferring ownership of its extended pipeline system to the state.