Markets react nervously to reshuffle of PKN Orlen board

Shares in PKN Orlen fell 4.6% yesterday, following a supervisory board reshuffle that left the government with a stronger hold on the company. At yesterday's general shareholders meeting the Treasury secured six seats on the nine-member PKN Orlen supervisory board, raising worries of potential political meddling in the company's future strategy. "Financial investors failed to gain a single board seat and they will have no say on the State's decisions, which appears to be the reason for today's fall," commented Wlodzimierz Giller, an analyst with Erste Securities in Warsaw. According to Puls Biznesu the reshuffle also strengthens the hand of tycoon Jan Kulczyk, who succeeded in having two of his associates voted on to the board. Yesterday's shareholders meeting also accepted a proposal to create a polyolefin joint venture with Dutch-based Basell Europe Holding. The plan, which has been promised "the full support of the supervisory board" will go ahead provided all the necessary documents are signed by June 30. "PKN Orlen has to team up with a strong international partner... The deal allows us to enrich our products portfolio," said chief financial officer Krzysztof Cetnar. (Gazeta Wyborcza, p. 30, Puls Biznesu, p. 8; Reuters) M.T.K.