“The state will take over Arpechim by April at the latest,” said Gheorghe Davidescu, prefect of Arges County.
Arpechim is the main supplier of state-run chemical plant Oltchim (OLT.RO).
“The next step will be to privatize Arpechim, alongside Oltchim,” Davidescu said.
Oltchim is 54.8%-owned by the Economy Ministry. Both the ministry and Oltchim have been contemplating buying Arpechim after Petrom said it would dismantle the unit because it couldn’t find a “credible buyer”.
Under a EUR3.5 billion financial agreement with the International Monetary Fund, the ministry was supposed to privatize Oltchim by the end of 2011. The IMF has agreed to extend the deadline until April this year, but insisted that neither the government nor Oltchim was to buy Arpechim until Oltchim is privatized.
Arpechim employs over 600 staff, almost half of which have received termination notices earlier Monday.