09 January 1997

Romania private tyre maker buys two local plants (Reuters)

BUCHAREST, Jan 9 (Reuter) - Romanian private tyre maker and distributor Tofan Group SA bought a 51 stake in two state-owned tyre plants, in what the company called the biggest privatisation deal so far in the ex-communist country.

A company statement said the group, owned by industrialist Gelu Tofan, signed a deal with the State Ownership Fund (FPS) worth over 200 billion lei ($139 million) for a controlling stake in Victoria SA and Silvana SA plants.

The FPS is the majority shareholder in around 6,000 Romanian companies slated for privatisation.

"We have pledged ourselves to the task of restructuring the whole tyre-making industry," Tofan told Reuters.

He said the group had already paid in 20 percent of the cash, with the rest to be paid by the end of the month.

"We are persuaded that we will succeed, at least in tyremaking, to get Romania's industry rolling again," he said.

Under the deal, Tofan Group SA, with a staff of 12,000 and a reported 1996 turnover on sales worth $90 million, pledged to keep on its payroll over the next five years all the 6,000 employees of the two newly bought tyre plants.

It said the latest acquisition would enable the group, which took over Romania's largest tyremaker Danubiana SA in 1995, to raise its sales figure to $200 million this year.

Roxana Dascalu, Bucharest Newsroom, 40-1 3120264