By Atom Markarian
The Armenian government granted an Indian-owned company one-year management rights to the troubled chemical giant Nairit on Thursday, in a surprise move ending expectations of its possible takeover by a Ukrainian firm.
The government had announced in October that Ukraine’s Inter-Contact chemical company is set to buy a controlling stake in Nairit-1, one of the two state-run enterprises that have emerged from the recent restructuring of the huge factory in south Yerevan. But officials from the Armenian ministry of industry said in December that top Inter-Contact executives have requested more time for deliberations.
Ministers’ decision to place Nairit-1, which retains most of Nairit’s manufacturing capacities, under the control of the British-registered company Ramsalt suggests that the Ukrainians have made a final decision to scrap the deal.
Armenian Minister of Trade and Industry Karen Chshmaritian said that under the agreement to be signed with Ramsalt soon the Indian-owned firm will buy a majority share and invest $20 million in Nairit-1 after one-year management.
“This is going to be a transitional period which is necessary before the company’s privatization,” Chshmaritian told reporters after a cabinet meeting. “It seems to us that privatizing Nairit right now would not be expedient.”
Ramsalt has been a leading buyer of Nairit’s main product, synthetic rubber, for the past several years. Officials say it has pledged to resume production operations at the currently idle factory within two months.
The flagship of Armenia’s chemical industry has been hit hard by the collapse of the Soviet Union, with thousands of jobs slashed over the past decade. Nairit’s debts to the state have reached a staggering $100 million.