Tuesday, July 26, 2011

Romania does not need to sell assets at low prices

BUCHAREST, July 25 (Reuters) - Romania's attempt to sell a near 10 percent stake in oil and gas group Petrom was a failure, but the country does not have to sell its assets cheaply "out of desperation," President Traian Basescu said.

Earlier in July, Romania failed to sell a minority stake in the company after bids fell below its minimum price, raising doubts over a privatisation drive promised under a 5 billion euros aid deal led by the International Monetary Fund.

"For us it was the right decision (not to sell), not what we would have wanted," President Traian Basescu told state television TVR on Monday evening.

"Romania must not be confused with countries that need to sell assets to pay wages and pensions. We are not in a situation to sell at whatever price and the government did well (not to)."

Basescu also said the government could not resume this year the listing process of its stake in Petrom, which is majority-controlled by Austria's OMV .

The sale, through which the government had hoped to raise $840 million, was a key test of commitment to sell stakes in more companies in the energy and transport sectors.

The planned sales include 15 percent stakes in power and gas grid operators Transelectrica and Transgaz later this year, and an initial public offering of gas producer Romgaz in 2012.

"This was a lesson for all of us," Basescu said. "We must get the right price for Romgaz, Transelectrica."

Most of the sale plans have been around for years, but successive governments have put privatisation on hold due to labour and political pressure.

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