CFR Marfa buyer seeks bank finance in ‘despair’ to seal privatization, says president

Newsroom 23/07/2013 | 13:42

Romania’s GFR, the private railway operator, which won the CFR Marfa privatization bid, is frantically seeking bank finance to buy a controlling stake in the state-owned company, said president Basescu on Monday evening.

The president rejected the appointment of Ovidiu Silaghi as transport minister following the resignation of Relu Fenechiu over corruption charges. He commented the privatization has to be completed with PM Ponta as interim transport minister, as a sign of “political responsibility.”

“I know that the winner (e.n. GFR) is looking, with certain despair, to loan money from banks to pay the amount negotiated in the privatization process,” said the president. “If the investor is taking out loan to pay for the company and doesn’t find it, at least at the moment, as there aren’t many banks willing to finance EUR 200 million, where will it find funding to modernize the company?,” said the president.

In a swift reaction, PM Ponta said the there is “nothing wrong” with the privatization process, which was deemed as “fair” by the international lenders.

GFR, which is controlled by Romanian businessman Gruia Stoica, has to pay EUR 202 million for a 51 percent stake in CFR Marfa.

The company, which is part of the Grampet Group, won on Monday the privatization bid for a 75 percent stake in HZ Cargo, the rail freight arm of Croatian Railways, according to railjournal.com. The transaction is valued at USD 190 million.