Romania changes privatisation plan for chemical company Oltchim

27 August 2012 16:29  [Source: ICIS news]

BUCHAREST (ICIS)--Romania's economy ministry has decided to sell its 54.8% stake in chemical producer Oltchim in one package together with debt worth of New Lei 1.79 bn (€401m), it said on Monday.

Furthermore, the ministry changed the date of the auction to September 18.

An indicative price of Lei 1.147bn has been set by the ministry for its stake.

Oltchim owes the money to the state privatisation authority, AVAS, and state-owned power producer Electrica. The figure represents around 56% of Oltchim’s total debts.

AVAS and Electrica will publish separate documents about the offer and sale procedure regarding their debts from Oltchim, according to the privatisation announcement.

“The government has decided to change the privatisation strategy after Oltchim failed to agree with minority shareholders on the planned debt-for-equity swap”, a government spokesperson told ICIS.

Under the initial privatisation strategy, the 54.8% stake was to be sold at an auction scheduled for September 14. Oltchim was also to increase its share capital with New Lei 1.13bn as a result of a debt-to-equity swap for the company’s debt to state privatisation agency AVAS.

In recent months, the Romanian government has been pushing forward with a privatisation timetable for the disposal of its majority stake in Oltchim, as part of a commitment to economic restructuring being carried out in consultation with, and with financial support from, the IMF.

The privatisation process has been postponed several times.

Germany-based chemical producer PCC and Cyprus-based Nachbar Services own 18.3% and 14.3% of Oltchim, respectively. Smaller shareholders held the balance.

Based at Ramnicu Valcea in southern Romania, Oltchim produces caustic soda, petrochemicals, agrochemicals, inorganic products and building materials, including insulating PVC for panels, doors and window frames.

($1 = €0.80)
(€1 = New Lei 4.46)

By: Marian Chiriac
+44 20 8652 3214

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