British firm targets new NATO states

British land conglomerate, the Rotch Group, revealed that its 1 billion 
[A$2.6 billion] sterling bid for a key Polish oil refinery was part of a 
strategy to profit from arms sales to new NATO states.

The company has joined up with Russian oil giant LUCOIL to buy 75 per cent 
of Poland's second largest refinery, Rafineria Gdanska, and expects to sign 
the final agreement in July.

"We are focusing a lot on Eastern European countries, which are joining 
NATO and are involved in big military procurements and are asking for 
military offsets", Rotch Group chairman Vincent Tchenguiz said.

Rotch is also looking at a large energy logistics transaction involving 
Polish oil refineries and rail network.

Offsets are deals requiring an arms seller to channel work or technology 
back to the country that buys the weapons by subcontracting work to local 
companies or through direct investments in unrelated fields.

Poland is currently being wooed by suppliers for a US2 billion sterling 
tender for 48 fighter jets.

The F-16, built by United States aerospace giant Lockheed Martin, is 
competing with the Gripen from an Anglo-Swedish venture involving British 
firm BAE Systems.

"We want to help defence and aerospace groups to unwind offset 
liabilities", Mr Tchenguiz said.

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Morning Star, Britain's socialist daily