VAROPreem emerges as a major European energy player after VARO completes Preem acquisition, delivering transformation strategy ahead of schedule.
VARO Energy has officially completed its acquisition of Preem AB, successfully concluding its ONE VARO Transformation strategy well ahead of the original 2025 schedule. Following all required regulatory clearances, the combination creates a new integrated energy company operating under the name VAROPreem, positioning it as one of Europe’s most influential players across conventional and sustainable energy markets.
The formation of VAROPreem represents the unification of two highly complementary businesses, combining VARO’s international trading strength and transition focus with Preem’s large-scale refining and industrial capabilities. Together, the merged company establishes a powerful platform built on scale, execution capability, and a proven transformation track record.
From a scale perspective, VAROPreem operates six strategically located manufacturing hubs and has access to more than 120 terminals, enabling service to customers across 33 countries. The company now ranks as Europe’s third-largest independent refiner, supplying approximately 10% of European mobility demand across road and marine segments. In addition, VAROPreem becomes the second-largest producer of renewable fuels in Europe and one of the six largest globally, underlining its growing importance in the energy transition.
Operationally, VAROPreem controls an integrated energy value chain spanning manufacturing, logistics, trading, and customer delivery. Its six core production sites include Lysekil and Gothenburg in Sweden; Neustadt and Vohburg in Germany (where VAROPreem holds majority stakes); Cressier in Switzerland; and Coevorden in the Netherlands. Collectively, these facilities offer processing capacity of roughly 530 thousand barrels per day of conventional fuels, 1.3 million tonnes per annum of renewable fuels, and 450 GWh of biogas production. The group also owns 100% of elexon, a leading European developer of commercial vehicle charging infrastructure.
Recent capital investments further demonstrate VAROPreem’s transition ambitions. These include the commissioning of the Synsat unit at Lysekil, which enables the co-processing of renewable feedstocks, and the expansion of bio-methane and bio-LNG production at the Coevorden site. While advancing low-carbon solutions, the company will continue operating Preem’s assets with a strong emphasis on security of supply, system resilience, and service continuity—recognizing their strategic importance to Europe’s energy infrastructure.
VAROPreem will continue to implement the “twin-engine” strategy first introduced by VARO in 2022. Under this model, Engine 1 supplies conventional fuels while Engine 2 focuses on sustainable energies. The original objective was to triple EBITDA within five years, with approximately 50% of earnings generated from sustainable activities. With the transaction completed, the company now expects earnings to be evenly balanced between conventional and sustainable energy businesses, while pro forma 2025 EBITDA is projected to be nearly three times higher than in 2021.
The combined organization benefits from strong financing capabilities and deep expertise in delivering complex energy infrastructure projects. With conventional fuel demand remaining resilient and sustainable energy markets expanding rapidly, VAROPreem is prioritizing reliable supply today while funding the next wave of transition investments—supporting both energy security and decarbonization objectives.
Commenting on the milestone, Group CEO Dev Sanyal said the creation of VAROPreem marks a defining moment for both legacy companies. He emphasized that the group has moved beyond building scale to fully achieving it, and is now well positioned to deliver secure, lower-carbon energy solutions across Europe while entering a new phase of growth.
The newly appointed Executive Board combines senior leadership from both organizations, reflecting the full integration of VARO and Preem across manufacturing, trading, sustainability, finance, and technology. The transaction was fully debt-financed, attracting 15 new lenders and expanding the lending syndicate to 30 institutions worldwide—demonstrating strong market confidence in VAROPreem’s strategy and long-term value proposition.
With its transformation delivered ahead of schedule and a unified leadership team in place, VAROPreem now begins its next chapter focused on disciplined growth, operational excellence, and sustained value creation.
