This is what the fusion of PZU and Pekao will look like. Details in Term Sheet

PZU and PEKAO signed Term Sheet regarding the reorganization of the PZU and Pekao groups, appointing a project, used to prepare and conduct transactions in 2 steps: the division of PZU leading to the separation of the operational activity of PZU to the company in 100 percent. depending on the PZU holding company, and then the PZU merger, as a acquired company, with the bank as a acquiring company – PZU said in a statement.

“The signing of Term Sheet initiates the cooperation of the parties in the preparation of a potential transaction. Its conduct depends on a number of factors independent of the parties, including the entry into force of appropriate legislative changes enabling a potential transaction in the manner provided for in Term Sheet, agreement and concluding relevant transaction documentation (within 120 days from the date of 120 days from the date of entry into force above legislative changes), obtaining consents of the Council of Ministers and a number of regulatory consents (in particular the consents of the Polish Financial Supervision Authority) and the granting of relevant corporate consents, including at the level of general meetings of PZU and Bank, “it was written.

According to the arrangements made in Term Sheet, the parties will establish a joint control committee (which will include PZU and Bank Presidents) and joint working groups, which will jointly carry out work aimed at implementing a potential transaction. PZU will take and conduct activities aimed at dividing the company in order to separate the holding and operational activities.

It was stated that the dates of key milestones of the project will be determined by the control committee.

“The parties, as part of the arrangements of transaction documentation, will determine, in particular, the rules for determining the parity of the exchange of PZU shares for the bank's shares, which would be issued to PZU shareholders in the process of merging these companies. The parity will be recommended to shareholders of the parties, in accordance with the law and good practices regarding transactions between related entities, guided by the interests of all shareholders, in the interests of all shareholders, in These minority shareholders of each party (PZU and Bank valuations in connection with a potential transaction will be made by reputable entities selected by PZU and Bank respectively) ” – it was written.

It was stated that Term Sheet confirms that the intention of the parties is to implement a potential transaction until June 30, 2026.

“Term Sheet will cease to apply in particular if work on legislative changes enabling a potential transaction in the shape specified in Term Sheet, they will not be advanced in the manner specified by the parties by the end of 2025 or if the publication of such legislative changes will not take place by the end of February 2026 and their entry into force will not take place until March 31, 2026. The above -mentioned connection will be carried out as possible as possible, with the connection does not take place without prior division of PZU ” – it was written.

“In turn, any obstacles to the possibility of conducting the connection of PZU and Bank will not affect the implementation by PZU of the division, which PZU considers to be carried out by the end of 2026 due to the effects on the PZU group of entry into force of the changes in Solvency II Directive, starting from January 2027.” – Added. (PAP Biznes)

alk/ gor/