Romanian power and mining company CE Hunedoara, currently under insolvency, faces imminent bankruptcy as it owes huge debt to the state and its power generation units do not hold operating permits from the environment agency, according to a report from the company’s court-appointed manager GMC published by hotnews.ro on March 18.
The only solution is for the government to accept the company’s mines in exchange for its claims and, as the main creditor of the company, to support a recovery plan for the power generation units, according to GMC’s report.
The company’s difficult financial situation is the result of short-sighted actions by all those involved - management, trade unions, employees, business partners, GMC said.
The government can, under EU regulations, provide help to the mines for closure until 2018, the court-appointed manager explained. Separately, the company could capitalise on its profit-making assets and sell one generation unit while investing in the others, GMC suggested.
CE Hunedoara owes some RON1.5bn (€337mn), of which RON1bn is to the budget.
The company delivers 5% of the country’s electricity and employs 6,500 people. While CE Hunedoara's power generation units are more or less profitable, its coal mines are expected to generate the toughest problems during the restructuring. However, former energy minister Gerea hinted last June that there are investors interested in taking over the mines.
The government tried to rescue CE Hunedoara last year but the state-aid came too late and the company was no longer able to buy the greenhouse gas emission certificates needed for the environment functioning permits. Judging from the situation as revealed by the court-appointed manager, the state emergency aid would have only delayed the company’s insolvency.
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