THE PRIVATIZATION OF CNPR - POSTPONED BY SIX MONTHS SIF Banat-Crişana, interested in the privatization of the Romanian Post Office

The privatization of the Romanian Post Office will resume after six months, the Government decided yesterday. It has also decided to initiate a process for the restructuring of the company and to "reassess" its debts.

The Minister for the Computerization of Society Dan Nica has been tasked with drafting a law, within a week, that would clarify the situation of the company.

The official, quoted by Mediafax, said that the binding and firm bids for the privatization of the company can be submitted by June 30, 2014, and this latter deadline can be moved forward if it is found that the post operator has become attractive following the reorganization.

By the expiration of the deadline for acquiring the presentation documents for the presentation of the company, no investor had bought the tender book, even though the authorities announced that they have held talks with over 50 companies, "at least one of them expressing its intention to participate in the privatization of the Romanian Post Office, namely a Romanian investment fund", according to Alexandru Petrescu, the president of the Privatization Commission.

At the end of March, in the proposed activity for this year, SIF1 Banat-Crişana has expressed its intention to participate in the privatization of the Romanian Post Office, and it was going to take the company public by listing it on the Bucharest Stock Exchange. The management of SIF1 justified its plan to do so by saying that the Romanian Post Office was a market leader in terms of volume, first of all when it comes to the services delivered to companies, it has potential for growth, a large portfolio of clients, it has opportunities to expand into other businesses, which are growing, and it also owns a platform for improving profitability, a 100% nationwide coverage and a strong brand.

SIF Banat-Crişana is still interested in participating in the privatization of the Romanian Post Office National Company (Compania Naţională Poşta Română - CNPR) even under the current circumstances, the representatives of the investment company told us yesterday.

"The moment the management of SIF Banat-Crişana expressed its intention to participate in the privatization of the Romanian Post Office it has contacted and there have been meetings held with potential partners for a privatization consortium, as there is a declared interest, but not expressed through a financial commitment, because the latter requires going through several stages of approval".

The consortium which was going to buy the tender book was not set up in time to submit the non-binding offer.

The submission of the call for tenders did not lead to any results due to the very tight deadline, as well as due to the hesitations of the potential investors concerning the value of the investment and the possibility of solving the social issues expected to arise in the restructuring of the Romanian Post Office.

If the privatization will be resumed, SIF Banat-Crişana will continue its steps to form a consortium which will answer the conditions necessary for conducting the privatization procedures and which will have the ability to successfully complete the privatization process, and especially the restructuring of and the streamlining of the company".

The representatives of the Romanian Post Office have emphasized, two days ago, that potential investors have requested the extension of the schedule for the privatization of the state owned company.

Ion Smeeianu, the general manager of the Romanian Post Office, said that the debts and the legislation regulating the operation of the Post Office have represented the main obstacles which have prevented potential investors from buying the presentation documents.

Under these circumstances, the authorities intend to erase the debts which the CNPR has towards the state, of 242.5 million lei, by converting them into shares, according to Mr. Smeeianu.

He said that the rescheduling of the debt newly uncovered by the ANAF debt of 107 million lei to the ANAF will be considered.

The company currently has total debts of 650 million lei, posting a financial loss of 52 million lei, at the end of 2012.

As for the staff restructuring, according to some estimates, the Romanian Post Office is set to lay off about 4,400 employees, which will receive between 3 and 30 severance wages, depending on their seniority, according to Ion Smeeianu.

The Romanian Post Office currently employs 32,000 employees, working in about 5,600 branches. According to the current announcement concerning the privatization of the CNPR, investors must provide pertinent and conclusive proof that they have their own or borrowed financial resources to successfully invest at least 150 million Euros in the Romanian Post Office. The announcement also mentions that the documents for the presentation of the company cost 50,000 Euros.

The shareholders of the Romanian Post Office National Company are the Ministry for the Computerization of Society, with 75% of the shares, and the Proprietatea Fund, with the remaining 25%.