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Volzhsky Orgsintez Turns Down Renova
The Renova Group has offered Volzhsky Orgsintez (the Volga Organic Synthesis Plant) shareholders $100 million for 100 percent of the shares in that plant. Volzhsky shareholders refused the offer, considering that sum to be a fraction of the true worth of the plant. Official Renova representative Andrey Shtorkh said that the plant was of interest to the group to form a holding for the production of additive to raise gasoline octane.
The Renova Group has offered Volzhsky Orgsintez (the Volga Organic Synthesis Plant) shareholders $100 million for 100 percent of the shares in that plant. Volzhsky shareholders refused the offer, considering that sum to be a fraction of the true worth of the plant. Official Renova representative Andrey Shtorkh said that the plant was of interest to the group to form a holding for the production of additive to raise gasoline octane.
The plant makes gasoline additives, nutritive methionine (an amino acid) and a preparation to speed the vulcanization of rubber. It is owned by the French ADDISEO France S.A.S. (25%), German Welding GMGH&Co. (about 20%) the Russian-German Farminvestprom (15%), private individuals and its workers. It has a sales volume of about 3.6 billion rubles in 2005 and 530 million rubles in net profit.
Chairman of the Volzhsky Orgsintez board Revaz Vashakidze confirmed that the offer had been made by Renova had that the shareholders rejected it. “A large-scale investment program is in effect at Volzhsky Orgsintez, as a result of which the plant plans to raise its sales volume by more then $500 million per year,” Vashakidze said. He added that the offer was a third of the real value of the plant.
Industry experts agree that the Renova offer was low. “Chemical-sector enterprises are hard to estimate now,” comment Eldor Azizov, general director of OAO Kaustik in Volgograd. “But the average cost of that type of plant is at least twice the volume of its annual sales.” Azizov saw a possibility that Volzhsky Orgsintez will become the object of a hostile takeover attempt by Renova Group now.
www.kommersant.com
All the Article in Russian as of May 04, 2006
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Photo: Pavel Kassin
