30 January 2013 14:01 [Source: ICIS news]
BUCHAREST (ICIS)--A government’s decision for petrochemical and plastics manufacturer Oltchim to enter insolvency was approved on Wednesday by a court in Ramnicu Valcea, southern Romania.
Following the announcement, Oltchim’s shares were stopped from trading at the Bucharest stock exchange.
The Romanian government decided on January 23 to start insolvency procedures in a move intended to pave the way for company’s future privatisation, due to the group’s current economic problems.
Furthermore, the government has chosen two local companies, Rominsolv and BDO Business Consulting, to make an audit and to propose a plan for restructuring Oltchim. The deadline for proposing a plan in this regard is early April, according to a government spokesperson.
The Romanian state holds a 54.8% stake in Oltchim, with Germany-based chemical producer PCC holding 18.3% and Cyprus-based Nachbar Services holding an additional 14.3%. Smaller shareholders hold the balance.
Oltchim is working now at around 30% of its current capacity. Production at Oltchim has been severely restricted for more than a year due to a lack of working capital to secure feedstock supplies.
The government cancelled the privatisation of Oltchim on 1 October 2012, saying that the winning bidder – Romanian television station owner Dan Diaconescu - had not provided documents to prove he had the money to purchase the majority stake.
The government has been pushing forward with a new 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 the IMF.
Based at Ramnicu Valcea in southern Romania, Oltchim produces caustic soda, petrochemicals, agrochemicals, inorganic products and building materials, including insulating polyvinyl chloride (PVC) for panels, doors and window frames.
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