By Atom Markarian
A senior Armenian official claimed on Friday that reports about the collapse of the country’s largest chemical plant are premature, saying that it may still be bailed out by a big Russian investor.Tigran Sarkisian, chairman of the Armenian Central Bank, said Russia’s Volgoburmash industrial group has requested additional time to decide whether it wants to become the owner of the troubled Nairit giant.
Volgoburmash took over the sprawling Yerevan factory last April, promising to restore its Soviet-era production levels with large-scale investments. However, the chief executive of Armenia’s national power utility, Yevgeny Gladunchik, dismissed those pledges as a “bluff” earlier this week, saying that the Russians have pulled out of Nairit and that it is now “dead.” Nairit owes the power grid $1.5 million in unpaid electricity bills.
Sarkisian insisted that Volgoburmash simply asked for four more months to make a final decision. He also revealed that Nairit is still technically owned by Haykap, an Armenian commercial that was placed under Central Bank administration due to its grave financial problems. A large part of them resulted from Nairit’s failure to repay its $14 million debt to Haykap.
The bank was granted the plant’s ownership in 2002 in payment for the debt but continued to teeter on the verge of bankruptcy. Sarkisian confirmed media reports that it has been purchased and effectively rescued by Flash, an Armenian company specializing in fuel imports. He said a part of $1.5 million paid by Flash will be channeled into Haykap’s cash reserves that have been below the threshold set by the Central Bank.
“The level of the bank’s liquidity has changed as a result, and Haykap now meets the minimum reserve demands,” he told reporters. “That allowed us to end the administration of Haykap.”
Analysts doubt that Flash has the expertise and financial resources to reactivate Nairit if the Russians finally decide to ditch it. The plant’s debts total $35 million.