PZU SA and Bank Pekao SA have signed a preliminary agreement (term sheet) outlining the principles of their collaboration in a potential restructuring of their capital groups. The goal is to establish a new, integrated banking-insurance group. The signing of the document marks another important milestone in preparing the transaction and tightening cooperation between the two institutions. It includes the creation of a Steering Committee and joint working groups tasked with moving the project forward.
A Multi-Stage Reorganization Plan
Under a memorandum of understanding signed on June 2, PZU and Pekao aim to increase the capital group’s efficiency and release up to PLN 20 billion in surplus capital. The proposed reorganization will be carried out in two phases:
- PZU SA will be split into a holding company and a wholly owned subsidiary conducting non-life and personal insurance operations.
- The PZU holding company will then be merged with Bank Pekao, which will act as the acquiring entity. The final decision on the merger will rest with the shareholders of both companies.
According to the term sheet, PZU has already begun work on the split and will continue efforts to establish the holding structure. The document outlines cooperation procedures, detailed responsibilities, and project milestones. The Steering Committee will consist of the CEOs of both companies and one board member from each. It will meet regularly and make decisions unanimously. A joint external project manager will also be appointed, and dedicated working groups will be established to handle specific project areas.
Determining the Share Swap Ratio
The agreement also sets the framework for determining the share exchange ratio—the rate at which PZU shares will be converted into Bank Pekao shares for PZU shareholders during the merger. This ratio will be established with the interests of all shareholders in mind, including minority shareholders, and the valuations of both companies will be conducted by reputable, independent firms selected by each party.
“We aim to execute a transaction that is absolutely unique in scale, complexity, and significance. Nothing like it has been done on our financial market before,” said Andrzej Klesyk, acting CEO of PZU. “We’re talking about releasing PLN 15–20 billion in capital for PZU and Pekao shareholders, and for the Polish economy. This mobilizes both institutions, our top employees, and advisors. The term sheet is a tangible step toward our goal.”
“We are entering the next phase of creating a new, significant financial group for the Polish economy,” added Cezary Stypułkowski, CEO of Bank Pekao. “We now have a clear roadmap, dedicated expert teams, and are shifting into a higher gear. Many challenges still lie ahead, but thanks to solid organization and close cooperation with PZU, we are well on track.”
Target Completion by Mid-2026
The term sheet confirms the parties’ intention to complete the transaction by June 30, 2026. However, its execution depends on several external factors, including:
- Legislative changes, including amendments to four key laws:
- The Act on the Management of State Property
- The Banking Law
- The Insurance and Reinsurance Activity Act
- The Insurance Distribution Act
- Completion and signing of detailed transactional documentation (within 120 days of the legislative changes taking effect)
- Approvals from the Council of Ministers
- Regulatory consents, particularly from the Polish Financial Supervision Authority (KNF)
Source: CEO.com.pl – PZU and Bank Pekao Take Another Step Toward Merger
