MOSCOW (March 20, 2009) — Russian petrochemicals company Sibur Holding has pulled out of debt acquisition talks with creditors of the troubled Dutch-Russian tire maker Amtel-Vredestein but could still buy up Amtel's assets if it files for bankruptcy.
Sibur had sought to acquire Amtel's debts from several creditor banks in exchange for Sibur bonds. The petrochemicals firm blamed the breakdown of talks on the failure of Russia's biggest bank, Sberbank OJSC, to decide whether to support the plan, agreed to by other creditor banks.
The Russian petrochemicals group is still interested in acquiring control of Amtel's Russian or Dutch assets and is “open to creditors' suggestions in case Amtel files for bankruptcy,” Reuters news agency quoted Igor Karavayev, deputy director of group offshoot Sibur-Russian Tyres as saying.
Sibur would stand to benefit from buying the Amtel assets cheaper at a later date as their value falls in the face of deteriorating world economic conditions, the executive admitted.
Amtel has suffered from debt refinancing difficulties, caused principally by AV-TO, its loss-making Russian tire and car retail business, and high interest costs. In 2007, the Russian subsidiary was responsible for $161 million of the parent group's overall loss.
Merger negotiations between Moscow-based Sibur, whose tire business is the largest in Eastern Europe, and Amtel of Enschede, Netherlands, collapsed last year in the face of the global financial crisis. Sibur had wanted to acquire a controlling stake of more than 60 percent in the groups' tire businesses.
In December, Amtel announced it could not afford to meet the demands of its Russian tire subsidiary's creditors. The group said it was unable to provide further financial aid to the offshoot OJSC. Amtel group has put up for sale its Dutch tire operation Vredestein Banden.
Sibur has four plants in Yaroslavl, Omsk, Ykaterinburg and Volzhsky, Russia, as well as the Saransk industrial rubber facility. Amtel-Vredestein runs tire factories in Moscow, Kirov and Voronezh.