VARO to acquire Preem in major renewable fuels expansion
VARO Energy has agreed to acquire Preem AB, one of Scandinavia’s largest energy companies, in a move set to transform VARO into Europe’s second-largest renewable fuel producer. The all-cash acquisition, subject to regulatory approval, is expected to complete in the second half of 2025.
The deal includes the full acquisition of Corral Petroleum Holdings AB, Preem’s parent company, and follows a competitive M&A process that began in late 2023. Deutsche Bank (Suisse) SA executed the sale agreement on behalf of Preem’s shareholder Moroncha Holdings Co. Ltd.
Preem operates two major refining complexes in Sweden—at Lysekil and Gothenburg—with a combined capacity of 352,000 barrels per day. The sites are capable of co-processing renewable feedstocks and represent around 80% of Sweden’s total refining capacity. The company has also invested nearly USD 1 billion in renewable fuel production since 2010.
Upon completion, VARO and Preem will jointly serve more than 50,000 business customers in 33 countries and account for close to 10% of all road and marine fuels sold in Europe. Sweden will become VARO’s largest manufacturing hub. The combined group will also be among the world’s top five producers of hydrotreated vegetable oil (HVO) and sustainable aviation fuel (SAF).
VARO Chief Executive Dev Sanyal described the acquisition as transformational, saying it positions the company to deliver secure, low-carbon energy solutions at scale. Chairman Marcel van Poecke added that the move would enhance VARO’s investment capacity and expand its contribution to Europe’s energy transition.
The company plans to focus future investment on strengthening supply security, improving asset efficiency, and expanding its biofuels portfolio. According to Supervisory Board Member Russell Hardy, who also leads Vitol, the transaction reflects a commitment to decarbonising European transport through biofuels.
VARO and Preem have together reduced their operational CO₂ emissions by 16% and abated 5.5 million tonnes annually for customers. The acquisition supports VARO’s 2022 strategy to triple EBITDA by 2026, with half coming from sustainable energy sources. EBITDA stands for Earnings Before Interest, Taxes, Depreciation, and Amortization.
