Thursday, February 28, 2008

Romania govt suspends drugmaker Antibiotice selloff

BUCHAREST, Feb 27 (Reuters) - Romania's government on Wednesday decided to suspend the sale of state-owned drugmaker Antibiotice Iasi ATBE.BX, which was scheduled for March 18.

The decision comes after the workers' union of Antibiotice won a court annulment of the law that envisaged an open bidding privatisation method for the firm.

However, an official source from privatisation agency AVAS, which is handling the sale, told Reuters the suspension is temporary and that the company will be back for sale "as soon as possible", likely still in the first quarter.

Late last year AVAS kicked off procedures to sell a 53 percent stake in Antibiotice, its flagship asset, through open bidding, at a starting price of roughly 136 million euros ($204.5 million).

Trade unionists criticised the method saying it was too hurried and put the firm at risk of being bought by an investor not keen on maintaining its core pharmaceutical activity.

AVAS had previously planned to sell the firm to a strategic investor through a process that involved binding bids and included negotiations with short-listed bidders. But it said such a method could lead to granting potential state aid to the company and prompt lengthy European Commission probes.

"Following the government's decision, and also taking into account the social and economic importance of the drugmaker,... AVAS will revoke the privatisation offer of Antibiotice Iasi in the shortest time," the government said in a statement.

The AVAS official said the agency will still use open bidding to privatise the firm.

The agency has said the method is in line with European Union norms as it eliminates any doubt concerning state aid.

European Union newcomer Romania has so far received 53 non-binding letters of interest for Antibiotice, which has ambitious growth plans, including the addition of new products to its portfolio. (Reporting by Luiza Ilie; Editing by Richard Hubbard)

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