By European Plastics News staff
London -- The long awaited sale of Romania's heavily indebted polymer and chemical company Oltchim was thrown into turmoil after the winning bidder refused to sign the sale contract.
Romania's Prime Minister Victor Ponta threatened today to reopen the privatisation process in six months time if the auction winner, Romanian TV mogul and politician Dan Diaconescu fails to sign the deal this week.
Ponta, speaking at a press conference, warned of legal action if Diaconescu did not have enough money to pay the sum of €45 million ($58 million) he bid, said national press reports.
On 24 Sept, Diaconescu refused to sign the contract presented by the government's Office of State Ownership and Privatization in Industry (OPSPI), claiming it had "missing clauses, provisions and annexes", and that the document "differed from the form announced simultaneously with the contract specifications", reported the online news service Romania-insider.com .
Last week, Diaconescu was among four bidders vying to take over the Romanian government's 54.8 percent stake in Oltchim whose total debts have risen over recent years to a staggering €700 million. It lost €46.8m last year.
The auction also included Duisburg, Germany-based chemical company PCC SE, which already holds an 18.3 percent share of the firm and offers from two Romanian companies: Chimcomplex and Aisa Invest.
Russian oil and gas giant Gazprom expressed an interest, but withdrew at the last moment. Romania's government said it wanted a bid from a large Russian firm which could supply oil to Oltchim's Arpechim refinery.
Râmnicu-Valcea-based Oltchim, a PVC producer, was forced to shut down last month due to a cash shortage. The privatisation procedure has led to mass protests by Oltchim's 3300 workers and 17 executives including its ceo resigned.
PM Ponta said he wants to restart the company with a new management and a loan from its privatisation fund before relaunching the sell-off process next year.
His government has been under pressure from the International Monetary Fund (IMF) for months to sell off Oltchim as a condition for future economic support.
This story first appeared on our sister publication, European Plastics News "