Bloomberg News

Romania Receives 4 Non-Binding Bids for Majority in Oltchim

April 17, 2012

Romania received four preliminary non-binding bids for a majority stake in Oltchim SA (OLT), an unprofitable state-owned chemical company.

Germany’s PCC SE, which already owns a minority stake in Oltchim, Russia’s JSC TISE and two Romanian companies, Pegamont SA and AISA Invest SA, submitted offers, the Economy Ministry said in an e-mailed statement today in Bucharest.

The ministry “will complete the presentation paperwork and will organize an auction to sell Oltchim, based on the negotiation of the preliminary, non-binding offers,” it said in the statement. Romania plans to hold the auction on May 31, said Florin Vladan, a ministry director in charge of state-asset sales, on March 27.

Romania’s government pledged to the International Monetary Fund and the European Union to sell stakes in state-owned companies, mostly energy producers, to help ease the budgetary financing burden as it aims to lower the deficit to 1.9 percent of gross domestic product this year from 4.35 percent last year.

Oltchim shares rose 3 percent to close at 0.99 leu today, valuing the company at 340 million lei ($102 million).

The potential investors interested in the stake also have the option to negotiate with OMV Petrom SA (SNP) on a takeover of its Arpechim refinery to have a “fully integrated company,” according to Vladan. The government aims to sell its entire 54.8 percent stake in Oltchim, while Petrom seeks to fully close the Arpechim refinery this year as part of a cost-cutting program.

The government extended the Oltchim sale from an original date of April 30 to wait for the European Commission’s approval of a debt-to-equity swap, aimed at increasing the company’s capital before the stake sale. It received the clearing from the European Union’s competition regulator on March 9.

To contact the reporter on this story: Andra Timu in Bucharest at atimu@bloomberg.net.

To contact the editor responsible for this story: James M. Gomez at jagomez@bloomberg.net


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