(romania-insider) -- The Romanian state will sell the majority stake in the chemical producer Oltchim Ramnicu-Valcea in a bid organized on May 31.
The deadline imposed by the International Monetary Fund (IMF) for ending privatization procedures was end-April. The privatization process will have two stages, and selected investors will be able to negotiate the acquisition of Arpechim, Olthim's main supplier, directly with its owner OMV Petrom.
Romania will sell 54.8 percent in Oltchim and four companies have so far stated interested in the company: Russian TISE, Forte from the United Arab Emirates, Romanian Rompet Romgas and German PCC - already a minority shareholder in the company.
The state will negotiate with the potential investors based on price offers, the only criteria taken into account. The negotiation will be based on evaluation pointing to a EUR 300 million price tag for Oltchim, if the company receives raw material from Arpechim, currently owned by Petrom. Without the raw material supply contract, Oltchim's value is almost zero, reveals an official document quoted by Mediafax.
The Government plans to turn Oltchim's debts into shares and sell them to the future investors in the company. This would increase the company's social capital and dilute the stakes of minority shareholders that unable to put money down to keep their current stakes. The European Commission agreed with the move earlier in March, ruling that this does not constitute state aid.