Citibank tells Handlowy to back out of Rafineria Gdanska bid

Bank Handlowy is reportedly considering withdrawing from the privatization of the Rafineria Gdanska (RG) refinery, as its majority owner Citibank deems potential returns too low, claims Puls Biznesu quoting an anonymous industry expert. "Citibank expects a 20%-30% return on each dollar invested. The RG investment does not present such prospects," said the source. Together with consortium partner Polimex-Cekop, Handlowy is bidding for up to 75% of RG. Other bidders are said to include Kredyt Bank, Hungarian oil giant MOL, a consortium of small Polish gas station operators Konsorcjum Gdanskie and U.S. MW Kellogs. The most controversial bidder is Poland's top oil firm PKN Orlen. The company is keen on acquiring RG, but the government plan for the oil sector excludes such a possibility. Deputy Treasury Minister Barbara Litak-Zarebska recently said that if the offers from other bidders are not satisfactory, the merger of PKN Orlen and RG, potentially leading to monopolization of Poland's gas market, could be considered. Final offers for RG are to be filed by March 12. (Puls Biznesu, p.7) T.J.