The privatisation of SNP Petrom, the largest company on the Romanian market, must be regarded as an efficient operation and not from the standpoint of the amount of money the State will be making from it, Romania's President Ion Iliescu says.
Inquired by Ziarul Financiar how much he thought the sale of 51% in Petrom should bring, Ion Iliescu said, "It is not the amount of money here. The important thing is to have an efficient privatisation. This is a valuable company. Romania has no natural resources, albeit it was the first in the world to drill for oil in 1857, two years before the US and three years before Russia."
The head of state says streamlining Petrom, a company that is currently employing approximately 57,000 people, will continue and the State will stand by the strategic investor as partner in this process.
"There are certain operations that are breaking up, are being outsourced. The State remains a partner in the company for a longer period of time," Iliescu said.
These were the first official statements of the head of state on Petrom's privatisation, which show Iliescu supports the privatisation method chosen by the Government, as proposed by Economy and Trade minister Dan Ioan Popescu.
According to the privatisation announcement, the Romanian State through the above-mentioned ministry sells 33.34% in Petrom to a strategic investor directly, with the investor left to attain 51% following a capital increase, in which EBRD and the minority shareholders will also participate. Minister Popescu was the biggest supporter of the privatisation by means of capital increase. Had the State sold 51% in the company to a strategic investor directly, it would have stood to get several hundred million dollars more for it.
Analysts estimate the total transaction value to be $1.3-$1.4bn, which sources involved in the privatisation process deem as "interesting and realistic."
Petrom's privatisation has now reached the short-listing stage, with 11 companies pre-qualified and set to be invited to submit preliminary non-binding bids until November 10. adrian.mirsanu@zf.ro
