By Atom Markarian
Armenia’s troubled chemical giant Nairit will restart work next month after standing idle for nearly six months, its new British-Indian operator announced on Monday.
A top executive from the London-based Ransat Group, which was granted management rights to Nairit on February 9, said the huge factory located in south Yerevan will resume production operations “in 30 days.” Anil Kumar, the state-owned company’s new chief executive, promised its 2,500 employees to pay their back wages and assured that none of them will be laid off anytime soon.
Under the terms of a five-year management contract with the Armenian government, the Indian-owned group is to invest $25 million in the struggling factory in the next three to four years. The deal came as a prelude to Nairit’s formal purchase by Ransat.
Kumar told reporters that the company is currently negotiating with creditors over Nairit’s outstanding debts totalling $35 million. Agreement has already been reached on the repayment of $10 million, he said.
One of the largest creditors is the Haykap bank. Nairit’s inability to repay its $15 million debt has put the bank on the brink of bankruptcy. Kumar confirmed reports that Ransat is now considering buying Haykap as well, and has already approached the European Bank for Reconstruction and Development for financial assistance. He said: “The strategy would be to develop Haykap into a strong bank by merging it with other banks. We have already discussions with the European Bank about that.”
Armenian government officials have portrayed Nairit’s takeover by Ransat as an opportunity to save the Soviet-era factory from collapse. Nairit has been hit hard by the country’s ten-year transition to the market economy. The British company’s four-year business plan calls for a tenfold increase in the annual production of synthetic rubber, Nairit’s main product.