MET Group announced Wednesday it is pulling out of its planned acquisition of a 54.07-percent stake in Achema Group, one of Lithuania’s largest business groups.
“MET Group has decided not to proceed with the transaction to acquire 54.07 percent of shares in Achema Group,” the Swiss energy company said in a statement.
“The legal disputes and the various uncertainties outweigh the potential benefits of continuing with the transaction,” it said.
“We are thankful for the support we have received during the process, but at the same time we also encountered many challenges from which we can learn,” MET Group Chairman and CEO Benjamin Lakatos said in the statement.
“We extend our best wishes to Ms. Lyda Lubienė and remain hopeful that Achema Group will navigate through the current hardships and build a strong future,” he added.
MET Group said its decision to exit the acquisition process was driven by unresolved shareholder disputes within Achema Group over preemptive rights, which cast doubt on the ownership of the shares.
“This deadlock situation hinders the execution of any potential share transaction and consumes valuable resources and the focus of everyone involved,” it said.
Achema’s former president and minority shareholder Arūnas Laurinaits has expressed interest in acquiring a controlling stake in the group, claiming the right of first refusal. He has said he filed a lawsuit against Lubienė, the current owner, over her intentions to sell her 54 percent of shares to MET Group.
Another factor cited by the Swiss company was the significant and complex business challenges currently facing the fertiliser sector.
“The mitigation of this environment would require imminent and harmonised actions from all stakeholders around Achema Group,” it said.
MET Group CEO: ‘A year or two is too long for us’
MET Group CEO says legal disputes between Lubienė and Laurinaitis would last too long, which is why it is dropping its bid.
“It was a fairly long process, lasting more than a year. However, we now see no possibility of completing the transaction,” Lakatos said in an interview published by the business daily Verslo Žinios on Wednesday.
“The main reason is that the minority shareholder has gone to court over his preemptive right to buy the shares. We respect that right and Lithuanian courts, but we see no possibility of proceeding with the acquisition quickly and smoothly. A year or two is too long for us,” he said.
According to the CEO, MET Group wanted to integrate Achema, the Lithuanian nitrogen fertiliser manufacturer owned by Achema Group, into its natural gas value chain and saw potential synergies between its own green energy plans and Achema’s green projects.
“We put a lot of work into this deal. I get emotional when I see the added value we could have created. Simply owning assets is one thing, but being able to generate new value through synergy is something entirely different,” he said.
Lakatos added that political rhetoric also played a role in the decision to walk away.
“Since we hadn’t signed a share purchase agreement, we didn’t start discussions with politicians and couldn’t present our business ideas. The negative media coverage about our company came as an unpleasant surprise,” he said.
After the company revealed its interest in Achema Group last June, Lithuanian media reported MET Group’s alleged ties to Hungarian Prime Minister Viktor Orban and Russian businesspeople with controversial reputations.
Minister: The government’s interest is keeping Achema viable
Economy Minister Lukas Savickas said Wednesday that MET Group’s move was a “business decision”, while the government's sole interest is ensuring the company remains viable.
“Every company and investor makes decisions independently. Our goal is simple: to ensure that economic activity can continue and that the company’s viability is maintained,” Savickas told BNS.
“I believe that’s our only interest, and we’ll see what other logical steps the businesspeople themselves choose to take,” the minister said.
“We don’t make decisions for businesspeople. They make their own decisions, and we create the environment in which those decisions are made,” he added.
Achema Group controls the Achema nitrogen fertiliser plant, which is on Lithuania’s list of companies important to national security. The facility in the central town of Jonava employs around 1,120 people.
Prime Minister Gintautas Paluckas has previously said that Achema could be involved in the production of explosives in Lithuania. According to him, the company has already carried out a feasibility study and selected a site for the future plant.
Paluckas has not ruled out the idea of the government, through its planned defence holding company, establishing a joint explosives manufacturing venture with Achema Group.
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