Viromet Victoria to close its Bucharest office

Shareholders of Viromet Victoria decided in the beginning of this week to close the company"s import-export office of Bucharest, while at the same time keeping the other 14 lucrative facilities in the county of Braşov. Shareholders also decided to appoint Viorel Barac to fill a vacant administrator position.

Turnover of chemical plant Viromet Victoria dropped substantially, by almost two thirds, in H1 2009, from 82.560 million lei to 28.045 million lei. The company"s revenues dropped from 82.560 million lei to 28.304 million lei, while expenses decreased from 82.449 million lei, to 34.234 million lei. As a result, the company posted a net loss of 5.937 million de lei in H1 2009, from a net profit of around 30,000 lei in H1 2008.

According to a report from the BSE, the losses came as a result of low demand for the company"s main product - methanol - for which it closed its production capacity in 2008.

"Starting at the end of 2008, demand for resins from furniture and wood particle board makers dropped as well. At the end of Q1 2009, after going through the legal procedures, we laid off more than 40% of our employees", the report sent to the BSE says.

The company based in Braşov is part of the Interagro group, owned by businessman Ioan Niculae. Niculae intends to delist the plant from the Rasdaq tier of the BSE and pay shareholders 3.51 lei/share, 50% higher than the last trading price. Niculae controls 95.9% of Viromet through the Interagro group. The businessman took over the majority stake in Viromet in 2002, from the former Authority for Privatization and Administration of State Interests by paying USD 3.6 million.