KMG International (KMGI), the oil refiner controlled by Kazakhstan’s state oil and gas company KazMunayGaz, wants to expand the petrol station network in Romania and Bulgaria once its legal problems are resolved, Alexey Golovin, KMGI strategy and corporate development vice president, told Reuters.
The company is also on the lookout for acquisitions in central Europe.
KMGI (the former Rompetrol Group) aims to increase its share of Romania’s petrol station market from 16% to 25%, as well as boost its share of the Bulgarian petrol station market to 15% over three years, according to Golovin. The company does not rule out acquiring existing networks.
In the medium and long term, KMGI plans to expand in the region, targeting countries such as Turkey, Ukraine, Serbia, and the rest of the Balkans. Acquisition targets could include petrol stations, storage capacities, and distribution companies, reports Reuters.
KMGI’s main assets are in Romania, where it holds the majority stake in Rompetrol Rafinare, which owns the Petromidia and Vega refineries, and Rompetrol Petrochemicals. The Romanian authorities seized Petromidia refinery in 2016 as part of an investigation into Rompetrol’s initial privatization in 2000. KazMunayGaz acquired the company in 2007.
According to Alexey Golovin, the legal issues were making it difficult for KMGI to secure financing.
“The total amount of assets seized is USD 1 billion, which we perceive as excessive,” he said. “This does not affect our day-to-day operations, but we cannot use them as leverage to acquire financing lines, which are like lifeblood for any company.”
Golovin also said that the asset seizure would not be lifted at least until the first court hearing into Rompetrol’s privatization case. However, the date for the hearing is yet to be set.
At the end of July this year, Chinese company China Energy Company Limited (CEFC) announced that it has received the Romanian authorities’ approval to take over a controlling stake in KMGI. CEFC has acquired a 51% stake in KMG International whereas the Kazakh state company KazMunayGas will remain with a 49% stake. The deal was signed at the end of 2016 and is expected to be finalized this fall.
Irina Marica, [email protected]