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December 3, 2020
BUSINESS

Solutions for Oltchim – resuming operations, or insolvency

Oltchim might resume operations in 30 days; salaries will be paid with the money obtained from debts, according to Economy minister Daniel Chitoiu.

PM Victor Ponta yesterday met the minister of Finance, Florin Georgescu and the chief of the National Agency for Fiscal Administration, Serban Pop for talks on restarting operations in Oltchim (OLT), then he had a phone conversation with Joaquin Almunia, European commissioner for Competition, about granting financial aid to the chemical works. Also yesterday, Ponta met at the government HQ the Russian ambassador in Bucharest, for talks about the future privatisation of Oltchim; the meeting was attended by the ministers of Economy, and Finance.  Another official present in the building at the time of the meeting was Remus Vulpescu, the former chief of the Office for State Ownership and Industrial Privatisation, which conducted the failed privatisation of Oltchim in September. In a separate move, the minister for Social Dialogue, Liviu Pop said yesterday that talks were held between the Ministry of Economy and Bancpost, in view of unblocking the account that holds part of the money used to pay the salaries for August in Oltchim. There existed the possibility that employees take their money yesterday.Minister Liviu Pop, who was yesterday in Arad for talks with trade unions at the prefect’s office, said that “the main problem remains resuming operations” in the plant. “We are waiting to receive the formal answer for the EUR 10 M which we will grant to the plant. This will deal with partly resuming operations, 65 pc, and paying the overdue salaries,” Pop mentioned, quoted by Mediafax.Liviu Pop also demanded that “the companies which have debts to Oltchim, like those controlled by the brother of Deputy Boureanu, the cousin of the former general manager, the driver of his aunt and cousin, all the firms that owe millions of euros pay at least 15 pc of the debts.” “There is a company that has debts worth EUR 1.8 M, which would solve the issue of salaries. This was theft from public money, which will be demonstrated by (law enforcement) institutions very soon,” he added. Pop also mentioned that Oltchim owes EUR 180 M to various banks, and any of the creditors might block the activity here, “but nobody will benefit from an insolvency procedure, because everybody would lose something.” “The new management of Oltchim has talks with all creditors in view of rescheduling the debts, and within six months the activity must reach the parameters needed in view of a successful privatisation,” Pop explained, Mediafax reports.In his turn, Economy minister Daniel Chitoiu yesterday voiced his hope that Oltchim Ramnicu Valcea (OLT) will resume operations within 30 days at most and the overdue salaries of employees will be partly paid, as the company recovers money from debtors, Mediafax reports. “Friday we signed a letter to the European Commission, in which we informed that we want to grant aid in view of resuming operations at Oltchim. We can grant this aid as a 6-month loan, at market interest rates, in view of restarting the activity. The sum which the state can extend will also result from negotiations with creditor banks, so we know what money they will bring as financing. (…) We hope to restart the plant within a month,” Chitoiu said.According to the minister, a meeting with creditor banks was due yesterday, in view of finding a solution to restart the Valcea-based chemical plant. Asked if insolvency would be a solution for Oltchim, Chitoiu gave an affirmative answer, but added that the main priority for the Ministry of Economy is to resume operations at the plant.

The EC, too, should be officially notified – cc head says

The economy minister sent to the European Commission a letter of intent for state assistance, whose go-ahead requires a formal notification to the Commission, said Competition Council (CC) President Bogdan Chiritoiu. “While the letter of intent is not a procedural step, it was wiser to do so. The state assistance is discussed and a 30-day deadline is set from the official notification,” Chiritoiu mentioned.The notification will be drawn up by the Ministry of Economy, Trade and Business Environment (MECMA), the Oltchim main shareholder, and will be sent to the European Commission thru the Competition Council.  According to Chiritoiu, the notification could be sent to Brussels even this week, depending on the EC’s reaction to the Letter of Intent of the Ministry of Economy

CSFO a new emergency structure

Officials from the ministries of Economy and Finance, AVAS, Electrica and several banks that must recover money from Oltchim will form the Oltchim Financial Stabilisation Committee (CSFO), which has on its agenda paying the overdue salaries, resuming operations and finding an investor. The chemical works will be restructured and reorganised, and the investor must be financially able to secure the operations of Oltchim and Arpechim at a level close to their potential output capacity. These days, the ministries of Finance and Economy had several rounds of talks with the main creditors of Oltchim.

 

 

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