Oltchim sell-off winner 'doesn't have the money' - Romanian PM

24 September 2012 17:27  [Source: ICIS news]

LONDON (ICIS)--The Romanian politician and media entrepreneur who won the privatisation auction for chemical producer Oltchim does not have the money to buy the firm, Romania's prime minister, Victor Ponta, said on Monday.

Dan Diaconescu now legally has the remainder of the 10 days following the 21 September auction to produce the €45m ($58.4m) which he bid for the state's 54.8% stake in Oltchim, he added.

“We pledged to [the International Monetary Fund under economic restructuring agreements to] have a privatisation in September, the fact that it has failed is not our fault,” Ponta said.

The Romanian Cabinet was set to discuss a plan for state-management of Oltchim for the next six months in the event that the privatisation did not produce a viable winner, the prime minister said.

In a statement, Diaconescu, the owner of the OTV television station, claimed he had not signed the privatisation contract and paid over the purchase capital for Oltchim because the contract has “missing clauses, provisions and addenda”.

His lawyers were working on resolving the situation with state officials, he said.

In July, debt-laden Oltchim was placed into special administration.

Production at Oltchim has been severely restricted for more than a year, with the company unable to source enough working capital to secure feedstock supplies.

Since early September, there have been sporadic protests at Oltchim by employees among the 3,500-strong workforce who fear a privatisation of the company will lead to hundreds of job cuts.    

Oltchim’s main products are polyvinyl chloride (PVC), polyols, dioctyl phthalate (DOP) and caustic soda.

($1 = €0.77)

By: Will Conroy
+44 20 8652 3214

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