Yet another attempt by the government of Romania to privatize the insolvent national PVC producer Oltchim SA has failed after none of four potential buyers submitted a firm bid by the deadline.
Now, administrators of the loss making chemical company will present a new reorganization plan for Oltchim later this month. The plan is expected to be submitted to the firm's creditor representatives for approval in March.
The latest bid to sell off the Romanian government's 54.8 percent stake in Oltchim collapsed in December when would-be investors pulled out at the last moment.
Among groups that had shown interest in Oltchim were a Chinese business consortium of Baota Petrochemical Group and Junlun Petroleum Co.; the Romanian SIF Transilvania investment firm; the Romanian chemicals group Chimcomplex Borzesti, which is owned by businessman Stefan Vuza; and an unnamed Turkish company.
“No one showed up, neither the Chinese group, nor the Turkish group, nor businessman Stefan Vuza, nor the Romanian investment fund SIF Transilvania. They proved to be unreliable investors,” the firm's judicial administrator Gheorghe Piperea told the local news portal Economcia.net.
This was the latest of numerous abortive attempts by the government to dispose of its majority share in Oltchim since the troubled firm was declared insolvent in January 2013.
Râmnicu Valcea-based Oltchim is aiming to invest in new technology that will enable it to achieve lower energy consumption in order to improve its financial performance. Reorganization of the business is essential for Oltchim to attract serious investor interest and a buyer, the government believes.
In the last year, Oltchim has improved its financial results, increasing its operational profit. In January this year, the firm is reported to have recorded a 700,000 euro ($797,000) profit, although the government said it still only operated at 30 percent of capacity.
Oltchim administrators comprise BDO Business Restructuring and RomInsolv who are currently developing the restructuring plan.
