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February 27, 2021
BUSINESS

Fenechiu: With 49 pc of shares, the state can prevent the scrapping of CFR Marfa

Although the IMF initially wanted total privatisation, a renegotiation has been achieved, the Transport minister said. The deadline for submitting privatisation offers was pushed back to May 8.

The minister of Transport, Relu Fenechiu informs that, after ceding 51 pc of CFR Marfa, the Romanian state will be able to prevent the sale of the company as scrap iron, while the restrictive conditions enforced through the task book will turn away the “intermediaries” that might wish to participate in the tender. “As I already explained, the debts are the result of the poor performance of those who managed the company, and of theft,” the official said on Pro TV.

“The initial position (of the IMF) was total privatisation. I succeeded – due to what I did with regard to financial and legal terms – (to make them accept) the sale of only 51 pc of the company, which actually means an association, not necessarily a total sale,” the minister explained.Fenechiu added that he wants the privatisation to be made with a company that will develop the freight rail transport in Romania. “They must have EUR 10 M in their accounts, only to be accepted in the privatisation, they must have a letter of comfort for the entire minimum sum of EUR 180 M, which is the starting price,” the Transport minister emphasised. Moreover, the interested investors must have an annual turnover of EUR 300 M and a significant experience in the field.The minister of Transport added that the state cannot turn CFR Marfa in a profitable company, as it currently has debts worth RON 2.3 bln in total, of which RON 1.5 bln to the state, and assets evaluated at approximately RON 1.3 bln.

Erasing the debt of the company can only be decided in case of privatisation.On the other hand, Fenechiu reiterated his opposition to the privatisation of the company, but the move was imposed by the financial accord signed by Romania with the IMF, WB and EC. “I strongly opposed this accord, if you know the history. I was face to face with the IMF official, I looked in his eyes and asked him: <<Excuse me, in the country you come from, does your state have a freight transport company?>> And he answered <<Yes>> Then I asked him <<Then why don’t you allow us, Romanians, to have our own freight transport company, like almost each country in Europe?>> And he answered (…) that, for several years, all the governments that came to power keep promising to the IMF and international organisations that they will instate performing management teams which will restore these companies. <<And each time we came, we found things worse, instead of better.>> (…) It was an imperative demand, because if I do not solve this issue until May, we will not be able to extend the stand-by arrangement with the IMF,” Fenechiu explained.The minister added that he tried to negotiate about this matter, and the talks with the IMF officials were “tough.” Fenechiu mentioned that the privatisation was necessary also in order to avoid penalties that would hit European funds. “For many years, CFR Marfa has not won even one contract.

Paradoxically, it lost all the tenders in favour of private companies, and even the two contracts it won, it took over from other companies, so it increased it portfolio,” the minister explained. Fenechiu also affirmed that CFR SA is the most important company controlled by the Ministry of Transport, and the management plan proposed by the former management team did not stipulate enough concrete goals and provided the layoff of 6,000 employees.

Among others, Fenechiu said that he would like to see Romania no longer needing an accord with the IMF, not even a stand-by arrangement, but this cannot be achieved unless the economy recovers.

Liviu Radu, new Chairman of the Board

CFR Marfa announced Friday that Aysun Mustafa resigned from the office of Chairman and member of the Board on 3 April 2013 and, respectively, 10 April 2013, because of personal reasons. He was replaced by administrator Liviu Radu, Mediafax reports. The deadline for submitting the documentation of participation in the pre-qualifying phase of the privatisation of CFR Marfa has been pushed back to May 8, from April 22, and the offers will be open and the winner will be designated on June 20, the Ministry of Transport announced. “The representative of international financial institutions agreed to postponing the deadline of submitting the documentation for the pre-qualifying phase, which was pushed back at the request of potential investors interested to purchase the presentation file and to participate in the process of privatisation,” the Ministry mentions in a press release.

A company dedicated to the construction of motorways, in project

The Romanian Company of Motorways and National Roads (CNADNR) will return under the control of the Ministry of Transport, and a company dedicated to the construction of motorways will be founded, Transport minister Relu Fenechiu announced. “CNADNR currently reports to the department of grand projects, led by minister Sova. All the national and European roads, and the motorways are in the portfolio of Mr. Sova. National roads will be in the portfolio of the Ministry of Transport. When I will have control over the road department, I will also take care of national roads,” the minister of Transport stated. He did not specify when this motorway construction company will be formed, only saying that “there is no hurry, I have other priorities.”

 


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