Firm|Mika Anttonen, owner of St1, would like to divide Neste in half, as both halves of the company would require full attention and skills. According to him, the traditional oil side is also in danger.
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Mika Anttonen, owner of St1, proposes to divide Neste in two businesses for renewable fuels and oil refining.
According to Anttonen, Neste does not understand the severity of its problems, especially in oil refining, whose operating environment is becoming challenging.
Anttonen has become a major owner of Neste and appeals to other shareholders and especially the state owners to share the company.
St1: n owner Mika Anttonen rose to the center of Neste’s Annual General Meeting on Tuesday after proposing the company to be divided. During the year, Anttonen has become a quiet owner of Neste during the year.
Now he can explain why.
Neste has focused on growing renewable fuel from vegetable oils and subsequent waste grease for the last 15 years and is the number one in the world.
Still, the company is still a large breeder of fossil crude oil.
There has been a lot of talk about renewable business difficulties in recent months, but according to Anttonen, the operating environment of the traditional oil business is also becoming really challenging.
The proposal for sharing a two business company so different is not new. Neste has been pondering the matter itself in recent years.
So what does Anttonen know that the company has not been known to the company?
In the first place Anttonen says he knew that the issue has been investigated by the government.
“But the surveys have been done in a completely different market situation, when the company’s stock price has been many times higher than the current one and the cash flow has been very good,” says Anttonen.
He is concerned that a company like Neste will not have the best know -how when the focus is distributed. According to Anttonen, the situation is so difficult that it is really that the experts in the industry should really get in both parts.
Neste does not speak much about traditional oil refining, although it has become a big part of the result in recent years. Anttonen believes that there would be a reason.
The problem with oil refining in Porvoo is that demand for fuel in the Nordic countries decreases as cars are electrified.
According to him, Porvoo is an export stand and the products should be taken to the EU internal market.
Outside the EU, production in the field of emissions trading is not competitive. According to Anttonen, the company has long neglected the traditional oil side trading expertise, which will sell the products.
“There is a danger that you will have to put the whistles in the bag before long.”
It would be a pity, because according to Anttonen, the refinery of Porvoo is one of the best in the world.
Anttonen My background is specifically in Neste’s Trading, so he knows what he’s talking about.
“Yes, it leaves me at least a shareholder that this issue is now quite internalized. There are 12 million tonnes of oil refining capacity, which is not known at all.”
Neste CEO Heikki Malinen Said at the Annual General Meeting that the Porvoo refinery also plays an important role in Finland’s security of supply, for example in the Defense Forces. Armor wagons run on diesel.
Anttonen does not buy an explanation. According to him, it is exactly the same whether there is oil in the security of supply stores, which is then processed into end products or finished fuels. The refinery alone does not save security of supply.
Also According to Anttonen, such a company is a problem for investors and is reflected in the value of the share.
Renewable business is of interest – at least around the world – quite different investors than oil business.
“One is global manufacturing and marketing of renewable fuels, and the other is local oil processing in the Nordic countries.”
When the government does not take on a leading role, Anttonen specifically appealed to other shareholders at the Annual General Meeting.
“For the state owner, that message was particularly directed.”
Renewable Side is even greater risks than refining fossil oil. The whole business depends on politically decision -making regulation. Now, for example, the progress of the mixing obligation has slowed down. However, Neste management insures confidence in market growth in the future.
According to Anttonen, it is possible that regulation will change to Neste even more radically in the unfavorable direction if, for example, bioside in biofar of carbon dioxide begins to be reduced in regulation.
“What is the company’s ability to even cope with such a situation?
According to Anttonen, St1, which makes a renewable diesel in Gothenburg, has eggs in different baskets so that the company does not fall if the market does not pull.
Yes Sounds miserable in every way. Why has Anttonen invested a lot of money in the company if everything is so wrong?
The main reason is that Neste’s stock is now really cheap. The company’s market value is only seven billion, although it has only invested ten billion in new refineries in recent years.
“Buying liquid paper gives you a refinery capacity at a cheaper price than building yourself.”
Another reason is, according to Anttonen, emotional.
“However, it is my breeder club. I have got my knowledge there and I would hope that the company will continue to succeed,” he says.
The third reason is that St1 happens to have a lot of money. The company is almost debt -free.
“There’s a big risk, but still the potential that the course is still rising.”
Instead, according to Anttonen, it is not about trying to crash or conquer the competitor.
“St1 is not a significant competitor in Neste in any way. Most of our business is in Sweden.”
Would you then be interested in buying the whole Porvoo refinery if the company was chopped?
“We wouldn’t have any chance at all. If you look at the balance of the St1, it wouldn’t be possible.”