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Rompetrol Needs Not Pay Its Debt To Romania – Ex-Owner

Businessman Dinu Patriciu on Tuesday said oil company Rompetrol, owned by Kazakh KazMunayGas, has the contract-stated right not to pay the debt claimed by the Romanian state.
Rompetrol Needs Not Pay Its Debt To Romania - Ex-Owner
Andrei CîrchelanBogdan Neagu
05 oct. 2010, 16:00, English

„The fact that they are not paying this debt is a right they have, through the contract,” said Patriciu, Rompetrol’s previous owner.

Romania will appeal in court oil company Rompetrol’s actions that do not comply with the law and will recover the debts by court orders, Prime Minister Emil Boc said Friday.

The Romanian authorities Thursday rejoined the shareholder structure of oil refinery Rompetrol Rafinare (RRC.RO) with a 44.69% stake, after the latter failed to redeem in cash a 2.3 billion lei (EUR1=RON4.2798) convertible hybrid held by the government.

KazMunayGas decided Thursday to convert into shares the bonds issued by Rompetrol in 2003 and not redeemed from the state, Rompetrol Rafinare said in a statement.

On Thursday, Rompetrol Rafinare also approved a RON1.97 billion capital increase to RON4.41 billion. Thus, the company will issue 20.65 billion new shares with a face value of RON0.1118.

Following the capital hike, the Rompetrol Group will directly and indirectly own an over 54.6% stake in Rompetrol Rafinare.

Rompetrol Rafinare, owned by Dutch-based Rompetrol Group, was supposed to repay the Romanian authorities a historic debt of EUR570 million by September 30.

The debt was issued by Petromidia refinery in 2003 and was converted into seven-year bonds by government decision.

On September 10, Romania’s tax authority ANAF seized several plots of land, facilities, and subsidiaries’ shares owned by Petromidia as security until the company repays its debt to the state.

„These were never real debts. They were debts the state owed to itself, before privatization. I never agreed to cover these debts,” Patriciu said Tuesday.

He added the debt he took over in Rompetrol’s privatization amounted to $108 million, „which were in fact $285 million, added with interest and penalties, to $572 million, a virtual debt that never existed. A debt owed by the state to itself,” Patriciu explained.

KazMunayGas bought in 2007 a 75% stake in Rompetrol, and the remaining 25% stake in June 2009.