English• Explosive rise for the stock of the company
• The banks are ready to support the company, including by offering new loans
Two banks may join the shareholder structure of "Oltchim" Râmnicu Vâlcea (symbol: OLT), through a debt to equity swap.
The Romanian Commercial Bank (BCR) and Banca Transilvania have expressed their interest in converting the debts of OLT into stock, according to a press release sent yesterday by the Ministry of the Economy following a meeting between minister Ion Ariton and the presidents of the two institutions, Dominic Bruynseels and Horia Ciorcilă.
"At the same time, the decision of the European Commission concerning the conversion process is being awaited", the press release also states.
The shares of "Oltchim" yesterday rose almost 15%, the maximum allowed fluctuation limit, to 1.064 lei, after rising for the four previous days.
Throughout the year, shares of OLT have experienced a high volatility, amid the conflict between the management of the company and PCC SE, which has a minority stake in the company. In June, the shares of Oltchim reached 2.04 lei, fell over the course of a few days to 1.16 lei, only to climb in the beginning of July to 2.211 lei, the high of the year.
On Friday, the competition Commissioner and vice-president of the European Commission, Joaquin Almunia, said that the European Commission has requested the Romanian authorities to provide a "clear commitment" and the calendar of the privatization of Oltchim and will also be reviewing the possibility of converting debt into stock of the plant.
Minister Ion Ariton yesterday presented the officials of the two banks with the privatization schedule.
BCR and Banca Transilvania expressed their willingness to support the company, including by issuing new loans, until the privatization is completed, the press release of the Ministry of the Economy says.
In October, last year, "Oltchim" announced, through the Bucharest Stock Exchange, that the Romanian Commercial Bank (BCR) would become a shareholder of the company through a debt to equity conversion of a part of the loan of 72.4 million Euros which the bank had given Oltchim in November 2009, press release which was later retracted, with "Oltchim" saying that "it regretted any problems and confusion created by the aforementioned press release, as well as any interpretation given to it".
Oltchim is controlled by the state, through the Ministry of the Economy, which owns 54.8% of the capital. According to the latest reports, German company PCC SE controls 17.47% of the shares of Oltchim, and investment fund Carlson Ventures, registered in the United Kingdom, owns 14.02% of the shares, through Nachbar Services. Approximately 1,000 employees of the plant were sent into technical unemployment, in October, for the third straight month, due to the lack of raw materials and working capital. Oltchim has 3,454 employees.
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