GDANSK/WARSAW (Reuters) – Poland’s greatest oil refiner PKN Orlen and quantity two participant Grupa Lotos mentioned on Thursday their administration boards had permitted a merger plan for the businesses.

Each refiners are state-controlled and the merger is a part of a wider plan by Poland’s ruling Legislation and Justice (PiS) get together to extend management over the economic system and construct huge nationwide corporations to higher compete with world gamers.

Shareholders of Grupa Lotos will get 1.075 shares of PKN Orlen for every Lotos share, the businesses mentioned in statements on Thursday.

For the merger to take impact shareholders of each oil teams should approve the share change. Shareholders proudly owning no less than 80% of Lotos shares must again the merger phrases to approve it.

Poland’s State Treasury controls 53.2% of Lotos shares and 27.5% of Orlen. It plans to finish up with a 35.7% stake after the merger, PKN mentioned in a presentation.

Normal shareholders conferences are anticipated to be held in July, whereas the merger ought to be registered and finalised in August.

Lotos shares gained 0.7% on Thursday to commerce at 70.84 zlotys ($16.63), whereas PKN’s shares misplaced 0.5% to 71.98 zlotys. The merger plan was introduced after the market shut.

($1 = 4.2598 zlotys)