VARO acquires Preem in “transformative acquisition”

VARO Energy (VARO) has reached agreement to acquire Preem Holding AB and Preem AB (“Preem”) through the purchase of 100% of the share capital of the parent company, Corral Petroleum Holdings AB (CPH), in an all-cash transaction.
Subject to customary closing conditions and the receipt of regulatory approvals the transaction is expected to be completed in the second half of 2025.
The agreement follows a competitive M&A process that began after CPH announced a strategic review of its assets in late 2023.
VARO has been engaged in this process for over 15 months, having entered exclusivity in August 2024.
As part of this process and in accordance with its rights under existing security arrangements, Deutsche Bank (Suisse) SA, as pledgee of the CPH shares, executed the sale agreement on behalf of CPH’s parent company, Moroncha Holdings Co. Ltd.
Preem is one of the largest energy companies in Scandinavia. The company plays a critical role in the region’s energy security, providing over 40% of Sweden’s and around a quarter of Scandinavia’s energy needs for transportation. It serves customers in 17 countries across Europe.
An early mover in renewable fuel production, Preem has invested nearly US$1 billion since 2010 in the production of renewable fuels and initiatives aimed at reducing the carbon intensity throughout the value chain.
As a result of these investments, Preem’s current renewable fuel production of 0.3 mtpa will rise to 1.3 mtpa with the Synsat diesel plant upgrade enabling up to 40% co-processing of renewable feedstocks.
The company also has a material pipeline of other renewable fuel projects.
Preem owns two major fuel manufacturing facilities in Sweden, at Lysekil and Gothenburg.
The two facilities have a combined capacity of 352,000 barrels per day, which equates to 80% of Sweden’s refining capacity, and the ability to co-process renewable feedstock.
Primarily located in Scandinavia, Preem’s assets are highly complementary to VARO’s existing operations across northwest Europe with limited overlap, said the company.
Dev Sanyal, CEO of VARO, said: “The acquisition of Preem is transformational for VARO. On completion, we will become Europe’s second largest renewable fuel producer with an extensive distribution and storage network across major European markets with conventional fuel production capacity of 530,000 barrels per day. Combined we will serve over 50,000 business customers across 33 countries, with our future growth underpinned by a robust portfolio of mature renewable fuel projects.”
Marcel van Poecke, Chairman of VARO and Chairman of Energy at Carlyle, said: “This acquisition provides material value creation opportunities through disciplined investment in future growth projects, while enhancing VARO’s ability to deliver the reliable and secure energy that Europe needs. The combined entity will be well positioned to continue to play an important role in meeting Europe’s growing demand for sustainable energy for the mobility and industrial sectors.”