[Intl-tobacco] Romanian gov't sells stake in tobacco co.

[rob@essential.org]

SEATTLE POST-INTELLIGENCER
Wednesday, January 21, 2004

Romanian gov't sells stake in tobacco co.

THE ASSOCIATED PRESS

BUCHAREST, Romania -- The government on Wednesday signed a deal to sell a
majority
stake in state-owned tobacco company to a foreign consortium for about $2
million
and agreed to make additional investments in the operation and cover its
debt.

The consortium, formed by the offshore firm Galaxy Energy International Ltd.
and
Italy's CTS SRL., will pay 1.6 million euros for just over 56 percent of the
National Tobacco Company.

In addition, the group agreed to provide an extra 4.7 million euros ($5.9
million)
in investments and working capital, according to Privatization Minister
Ovidiu
Musetescu.

The consortium also agreed to pay some 5.5 million euros ($6.9 million) to
cover
the company's debts.

Lawyer Stephen Jarvis, whose company acted as adviser for the consortium,
said the
Italian company is a tobacco processor, while Galaxy Energy International
Ltd. is
the offshore vehicle of Monaco-based Galaxy Group, a company that
specializes in
shipping management.

Tobacco is a lucrative business in Romania, where some 30,000 metric tons of
cigarettes are sold annually. The tobacco company has the capacity to
annually
produce 25,000 metric tons of cigarettes.