14 November 2005 12:44 [Source: ICIS news]
PRAGUE (ICIS news)--The Czech Cabinet will discuss the shock takeover of the state’s holding in Czech biodiesel additives supplier Setuza, the government said on Monday.
Entrepreneurs behind the Czech firm Cesky Olej used a little-known buy option arranged with a former agriculture minister to win control of Setuza.
The prime minister’s office confirmed that the takeover, which saw Cesky Olej increase its stakeholding to 90.7% from 49.9%, was on the agenda for Wednesday.
The takeover was performed following the government's refusal to remove a long-term Koruna3bn ($121.7m/Euro101.5m) debt from Setuza’s books. The refusal came after prime minister Jiri Paroubek in October ordered a review of the debt owed to state bailout institution Ceska Konsolidacni Agentura (CKA) after claims about the entrepreneurs’ role in the ongoing Unipetrol privatisation affair.
Paroubek said that he had not known about the buy option, arranged with former minister Jaroslav Palas.
A Setuza management source said that Cesky Olej’s negotiating stance was that if the government agreed to clear the debt then it would consider re-adjusting the company’s ownership structure.
Setuza is currently building towards a 200,000 tonnes/y production capacity for rape-oil methyl ester (ROME), an input material for biodiesel. Attaining the output would make it one of Europe's sixth largest firms in the sector.
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