The shareholders of "Oltchim" want private managers for the company

The shareholders of the "Oltchim" chemical plant (symbol: OLT) yesterday approved "the initiation of the selection procedure for the selection of new non-executive and/or executive directors", in compliance with the dispositions of the Government Emergency Ordinance no. 109/2011, concerning corporate governance in public institutions, according to a report sent to the Bucharest Stock Exchange.

The summoning of this general shareholder meeting was initially considered pointless even by the management of the company, when considering that the state, through the agreement concluded with the International Monetary Fund, had announced that "Oltchim" would be privatized in April this year.

In the current context, after the European Commission decided to convert the debts of "Oltchim" towards the Authority for State Assets Recovery (AVAS) into stock, the sale of the majority stake which the state owns in the chemical plant might be delayed.

According to the Emergency Ordinance, as a first step, approximately one month after the coming into effect of the law, state owned companies with a turnover of ore than 1 billion lei at the end of 2010 and more than 1,000 employees, will launch the procedures for selecting the first private directors and managers. Later, as the contracts of the current directors/managers expire, the procedure will be applied for the selection of the new candidates.

The government ordinance establishes the steps which need to be followed for the selection of the new directors. Thus, in the first stage, the shareholders assembled in the General Shareholder Meeting will decide on the initiation of the procedure to elect the executive and/or non-executive directors, and after the summoning, independent recruitment experts will be selected, which will support the public companies in making an objective, transparent and professional selection.

The final stage, after the selection of the directors/managers, consists of the summoning of a new general shareholder meeting for the appointment of the selected directors and the signing of the management contracts.

According to the legal provisions, the state can propose candidates for the positions of members of the board, but these nominations must be made following a preliminary selection made by a commission of Human Resources specialists.

In the last general shareholder meeting, which took place at the end of January, the shareholders of "Oltchim" decided to postpone the sale of the stakes they owned in other companies and of the divisions of the plant, as well as suspend all the sale procedures which the management had already begun or was going to begin.