Banks wary of supporting NP's chemical sector plans

Nafta Polska (NP), the state agency responsible for oil sector privatization, is seeking to persuade banks to participate in restructuring the chemical sector. Theoretically NP has the mandate to manage chemical companies stocks but banks participation is essential if the restructuring process is to be successful. The first meeting with financial institutions has been scheduled for the end of August, when NP will have detailed information on the financial state of the chemical sector. NP is hoping that banks will play a role in the ownership structure of the various producers of particular products, such as melatonin. It is not clear yet if the banks will accept the offer, as so far they have been very reluctant to grant loans to companies whose structures are not sufficiently transparent to trace the flow of capital. "I realize that not all the banks are interested in investing in the chemicals sector. The level of investment depends on the profitability of converting receivables into stocks, that is why we are concerned that the banks should know in advance with whom they may negotiate with if they eventually want to reselling their blocks of shares, which they may get through the conversion of receivables," said Maciej Gieroj, president of NP. (Puls Biznesu, p. 4) K.S.