IN ORDER FOR OLTCHIM TO COLLECT THE 10 MILLION EUROS INSURANCE POLICY, Roibu: "The receivers need to prove in court that the management was flawed"

Starting in 2011, Oltchim has concluded with Astra Asigurări, an insurance policy of 10 million Euros against defective management of the plant, an amount which the managers of the plant are now requesting from the receivers of the plant. On April 30, the receivers sent their request to the insurance company, showing that the conditions of the insurance policy have been met (flawed management which caused the company to incur losses).

Flawed management is one of the reasons which have led to insolvency, the receivers of the plant stated in a report (Rominsolv and BDO Business Restructuring).

Contacted by phone, Constantin Roibu, the former general manager of the plant of Vâlcea, said: "Flawed management is not the real cause of the insolvency of Oltchim. The report on the causes of insolvency was only drawn up so a scapegoat can be found. So in order to collect the insurance policy, the receivers need to prove in court that the management was flawed and that it has caused financial losses to Oltchim".

When asked why he felt the need to conclude such an insurance policy, Mr. Roibu told us that this kind of policies is common in major companies.

Yesterday, Varujan Vosganian, the minister of the Economy, said that Oltchim is current with the payment of the insurance premiums, of 3,000 Euros per month, as the insurance policy concluded with Astra is renewed annually.

He said that the insurance policy was found in the records of Oltchim one month ago, and that it would be unseemly that Astra Asigurări refused to pay the insurance policy claiming that the company had a competent management.

Mr. Vosganian said: "It would be unseemly for Astra to tell us that the conditions aren't met for the ten million Euros to be paid. We have the report of the receivers on the causes of the insolvency, which states that the management was flawed. I understand that Astra is reinsured with some of the largest companies in the world. In my opinion, Astra is playing the card of the Romanian insurance system because dealing with the problem and honoring the policy could increase the reputation of the Romanian insurance industry".

• The amount of the insurance policy - a source of financing

The amount of 10 million Euros could represent one of the financing sources that Oltchim needs, said Varujan Vosganian. On that date, the receivers want to advance the talks with the traders which can offer financing of 30 million Euros for the plant.

In order to operate at a capacity which could ensure profitability, Oltchim needs 50 million Euros, minister Vosganian said. Which means that aside from the traders' money, it would need the 10 million Euros from the insurance policy and another 10 million Euros from sale & lease-back procedures, through which the plant's installations can be sold and re-rented.

The Minister of the Economy said: "Any involvement of the state's institutions in financing the company can run against the obstruction of the European Commission. We are in constant connection with the Competition Council and I have informed the members of the government during the meeting, that next Wednesday I want to make an announcement concerning the funding the plant needs and the possibility of getting it".

The Ministry of the Economy has received ten letters of intention for the Oltchim Râmnicu Vâlcea plant, from major companies in India, Qatar, Great Britain, Germany, Israel or Azerbaijan, as in some cases, officials of some of those companies visited the plant.

• The layoffs are starting

Oltchim is currently operating at 27%, and the receivers will go to layoffs. The severance packages paid to the employees of Oltchim will be paid according to their seniority: those with less than ten years of work will receive money for a year, and those with over 25 years - two years.

Varujan Vosganian said: "I have promised the employees of Oltchim that we will ask the receiver not to make layoffs until we have the legal guarantee that the people in question will receive the rights which arise from the renewal of Emergency Government Ordinance OUG 116/2006 and the passing of a special Government Decision for Oltchim. This year, the Government will grant an amount of up to seven million lei for covering the supplemental revenues of the employees of Oltchim. The supplemental revenue is calculated as the balance between the national average net salary and the unemployment compensation".

On the issue of the wages and demands of the unions, the main shareholder of Oltchim has done its job, the Minister of the Economy said, who also said that he has talked to the Minister of European Funds, Eugen Teodorovici, and Labor Minister, Mariana Câmpeanu, in order to organize training classes for the reintegration of those who are laid off. The number of the employees is estimated at 1,000.