Romanian Econ, Fin Mins, AVAS Pres To Meet Chem Prod Oltchim Mgmt Wed

The meeting will take place at the headquarters of the Economy Ministry.

 

According to the plant trade union leader Mihai Diculoiu, the economy minister Adriean Videanu, minister of finance Gheorghe Pogea, and AVAS president Mircea Ursache, met at the plant’s headquartears Tuesday with Oltchim’s trade union and management.

 

"It was settled a meeting Wednesday, at the Economy Ministry headquarters, with all the people in charge, to find a way for Oltchim’s urgently taking over the petrochemical activity of Arpechim Pitesti, owned by Petrom OMV. Hence, the meeting will equally be attended by Petrom OMV management; a second serious issue to be discussed in the presence of the Competition Council’s management, is to find a solution for Oltchim’s share capital hike, through the conversion into shares of AVAS receivable at Oltchim, worth a total of EUR135 million," Diculoiu said.

 

Governmental sources told MEDIAFAX mid-February that Oltchim needs EUR620 million for investments, namely upgrade works, a share capital hike, environmental investments and for buying Petrom’s Arpechim petrochemical unit. Oltchim was in talks for a EUR100 million loan from European Bank for Reconstruction and Development, or EBRD, and Austria's Erste Bank, for buying Petrom's Petrochemicals Arges unit, the sources added.

 

The authorities aim to hike Oltchim's share capital with the value of a debt it has to Romania's Privatization Authority AVAS, worth EUR134.58 million. The company’s general manager Constantin Roibu told MEDIAFAX that Oltchim needs the Romanian government support for the European Commission to approve the share capital hike.

 

The Romanian Government have recently decided to start the evaluation of granting a financial support Oltchim, mainly by offering a guarantee for a loan, as the company was sharply impacted by the financial crisis.

 

Oltchim reported a turnover of 1.946 billion lei (EUR1=RON4.2810) in 2008, 11.3% higher from RON1.749 billion a year earlier, and RON225.64 million in losses, from RON95.89 losses in 2007, in the light of the financial crisis, which triggered lower prices and lending restrictions.

 

In the last quarter of 2008, the company was forced to cut production to 55%, registering losses due to the payment of salaries and to the equipment maintenance costs.

 

The plant is 53.26% owned by the Romanian Economy Ministry, while its main minority shareholder is Polish company PCC SE, with a 12.89% stake.

On the Bucharest Stock Exchange Tuesday, at about 1208 GMT, Oltchim shares were traded at RON0.1240 per share, down 2.36% on the day.