(Bloomberg) — Poland’s de facto leader has revealed a plan to buy the country’s biggest grocery chain, Zabka Polska SA, in the state’s latest attempt to tighten its grip over the economy.
“We’re moving in this direction,” Jaroslaw Kaczynski, the head of the ruling Law & Justice party, told a rally in Pulawy, eastern Poland, late on Wednesday. The government has pledged to “take back most strategic parts of our economy from the hands of the foreign capital,” he said. The state may also soon buy PKP Energetyka, a power distribution company, according to Kaczynski.
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Zabka and PKP Energetyka are owned by U.S.-based private equity fund CVC Capital Partners. Krzysztof Krawczyk, who heads CVC in Warsaw, declined to comment when contacted by Bloomberg.
Kaczynski didn’t elaborate on the details of the potential transactions. PGE SA, the country’s largest power utility, is finalizing a deal to buy a key energy company, State Assets Minister Jacek Sasin said earlier on Wednesday. PGE didn’t have an immediate comment.
CVC bought Zabka convenience stores in 2017, in what was then the biggest deal in the country’s retail industry. The chain last year ran about 8,000 outlets, with sales rising 22% to 12.4 billion zloty ($2.5 billion).
The government may use state-controlled refiner PKN Orlen SA to buy Zabka, according to Trigon Dom Maklerski SA analyst Michal Kozak. The country’s largest company has already made some surprising acquisitions since Law & Justice came to power seven years ago. It bought a struggling press distributor Ruch in 2020. The following year, it purchased a newspaper publisher from a German owner.
PKN has no plans to buy Zabka, Chief Executive Officer Daniel Obajtek was cited by PAP newswire on Thursday. However, there may be another suitor. Agriculture Minister Henryk Kowalczyk said earlier this year that a state-owned food holding Krajowa Grupa Spozywcza is more likely to buy a retail network of stores than to build one from the scratch.
Poland earlier this year merged several state-controlled agricultural companies into a single group in what the government said was going to help stabilize food prices, increase reserves and help the country gain independence from foreign producers.
The acquisition by the state of one of the biggest retailers could rattle the industry. “Zabka has applied higher prices and as a convenience chain it didn’t compete with discounters or supermarkets,” according to Janusz Pieta, an analyst at MBank SA. The question is whether it can continue such policy when the state takes control, he said.
(Updates with comments from Orlen CEO in 7th paragraph.)