Reuters reports that Poland is finishing work on a bill that will allow it to nationalize energy firms on state security grounds in the event of a hostile takeover bid, citing president Lech Kaczynski.
Our view: The aim of the bill is clear for us: to protect Polish energy firms from potential takeovers by Russian giants. However, it is still a question how the EU would react on such a bill. Many claims, it could conflict with rules on the free market.
Since the share price of PKN and PGNiG do not contain any takeover premium, we do not expect a negative reaction to the news. However, the potential abusing the rule might be a threat for long-term investors.