Wednesday, April 11, 2012

Roman Copper hopes to rescue Romania mine deal

BUCHAREST | Tue Apr 10, 2012

(Reuters) - Canada's Roman Copper Corp sought on Tuesday to rescue a deal to buy Romania's biggest copper mine, saying it was prepared to meet conditions required by the government, which had pulled out of talks.

However, a government spokesman told Reuters the deal was still off.

Roman Copper last month won a tender to buy Cupru Min Abrud for 200.8 million euros ($262.3 million), outbidding Australia's OZ Minerals Ltd (OZL.AX), Dutch Dundee Holding and Bulgaria's Ellatzite Med Ad.

Romania's economy minister said on Saturday the deal had fallen apart and the government would relaunch the sale, dealing a blow to a sell off plan agreed with the International Monetary Fund.

The ministry said in a statement that talks to sign the deal ended on April 6 without reaching an agreement and that negotiations with Roman Copper were "irrevocably closed."

It said the government did not want to give up certain conditions, among them that all privatization contracts are made public, that payment for shares is settled within 30 days and the company sets up a collateral deposit of 32.27 million euros as a guarantee for future environment investment.

Roman Copper said on Tuesday it had accepted the terms.

"Roman Copper's team and the Romanian government's negotiators agreed on the terms and conditions of the acquisition contract in the late evening of Friday, April 6 2012. These terms included an undertaking by Roman Copper to accept additional financial and other obligations that were not required in the original tender documentation," it said.

Government spokesman Dan Suciu said Roman Copper's statement changed nothing, however.

"The process is now closed. The sale of Cupru Min to Roman Copper won't happen," he said by telephone.

Former communist countries across the European Union have sold state holdings, but Romania's persistent failure to do so has left a huge, inefficient public sector in the bloc's second-poorest nation as it struggles to emerge from deep recession.

Analysts say failure to sell Cupru Min - with estimated reserves of 900,000 metric tonnes (992,080 tons) of copper, or about 60 percent of the country's overall estimated reserves - would not bode well for a plan to cut state participation in its enterprises.

"Roman Copper unequivocally confirms its readiness to implement all the actions and investments requested by the government since the open auction for Cupru Min on March 26," the Canadian firm said in its statement.

"We look forward to continuing our relationship with the Romanian authorities in a spirit of good faith and co-operation so that this transaction can be completed as envisaged under the competitive and transparent privatization process."

(Reporting by Radu Marinas; Editing by Mark Potter)

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