PGG – KHW merger approved. Gets PLN 400 mln financing

The management board of Katowicki Holding Węglowy (KHW) approved the transfer of KHW assets to Polska Grupa Górnicza (PGG), clearing one of the final hurdles before the merger is finalized. The transaction is expected to be completed this week. Additionally, two state-controlled utilities, Energa and PGNiG Termika have decided to capitalize PGG with PLN 100 and PLN 300 million respectively. “Recapitalization of PGG by PGNiG Termika should be made in tranches and be considered as one of the sources of financing for planned purchase of KHW's assets by PGG,” PGNiG said in a market filing. “This amount will support PGG in expanding its activities and obtaining synergies from incorporation of KHW's production assets into PGG,” Energa representatives added. Government hopes to capitalize PGG with PLN 1 billion.