Romanian chemical producer Oltchim to file for insolvency after failed privatization

Romanian chemical producer Oltchim will enter insolvency, and the request for insolvency will soon be sent to the Valcea court, according to Economy Minister Varujan Vosganian, quoted by Mediafax.

Oltchim, which went through a failed privatization last year, will have its board decide on the insolvency on Wednesday (January 23 ). This will be the second large state – owned Romanian company to file for insolvency, after Hidroelectrica last year.

According to Romania media, quoting sources close to the talks, Prime Minister Victor Ponta had talked to the International Monetary Fund (IMF) officials about Oltchim and concluded that insolvency was the main solution to make privatization of the company easier. Oltchim needs restructuring, and layoffs will also be part of the process.

The bid for Oltchim was won last year by media mogul Dan Diaconescu, who failed to pay the EUR 45 million he had pledged to offer. After the failed privatization, Romania did not give a new privatization term for the company, which is indebted and whose workers suffered payment delays in the last months of 2012.

Adapted from Romania-insider