Romania to accelerate public offerings and privatizations of state-owned enterprises

The Romanian Ministry of Economy has been able to turn around the financial situation of 8 state-owned companies (SOEs) that have been under the monitorisation of the IMF, and will accelerate the processes of privatizations or public offerings, according to an official press release from Romanian authorities, following a meeting with the joint mission of the IMF, EC and World Bank.

SOEs registered progress
The companies – Termoelectrica, Elcen, CNH, SLO, OLTCHIM, Complexul Energetic Turceni, Electrica Furnizare Transilvania Nord and Electrica Serv – with operations in the energy sector have been able to cut the level of arrears and have also slashed personnel expenditure by 4.5 percent. The losses of these companies have also been reduced by 50 percent. Some of the monitored companies have even registered profits in the nine months of 2011.

Romania to set up two energy giants
The Romanian minister of Economy, Ion Ariton, stated that the Ministry has signed a memorandum of understanding with Fondul Proprietatea, regarding the creation of two energy champions, the Oltenia Energy Complex and The Hunedoara Energy Complex. The Oltenia Complex will reunite SNLO, Rovinari, Turceni and Craiova complexes while Hunedoara will include Electrocentrale Deva and Paroseni, and viable mines.

Public offerings and privatizations to be accelerated
The privatization and public offerings of SOEs has also been a topic during the discussions between the Ministry of Economy and the international representatives.

The Ministry of Economy will accelerate the public offering for Romgaz (15 percent stake), Transelectrica (15 percent), Hidroelectrica (10 percent), Nuclearelectrica (10 percent), while Oltchim and Electrica Furnizare will be fully privatized, including resulting companies from the splitting of Electrica Serv.

The selection of private management under way
New private managers will be assigned to carry the privatization procedures at Oltchim and Electrica Furnizare. Private management will also sit at the newly formed energy giants Oltenia and Hunedoara, at Romarm and Hidroelectrica.
The international team acknowledged Romania’s progress on implementing private management for SOEs, which should bring notable results in the restructuring and efficiency of assigned companies.