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The eBearing News
August 8, 2005
Rulmentul Brasov Continues Losses
in 2005 First Half
copyright © 2005 eBearing Inc.
Rulmentul Brasov (Romania, 50% state-owned) continues to report heavy losses, now through
the first half of 2005.
Founded in 1949, Rulmentul SA Brasov is Romania's largest bearing manufacturing company. Under
RBR and URB (Uzina Rulmentul Brasov) brands, the company manufactures ball bearings, linear
bearings, tapered roller bearings, and needle roller bearings.
A portion of Rulmentul Brasov's stock began public trading in 1994, and the company was nominally
privatized in 2000. It is publicly traded (BSE symbol: RBR), but 51% owned by AVAS, the Authority
for State Assets Recovery, Romania's privatization agency.
Rulmentul Brasov's continued existence has been possible only by massive government debt write-offs,
subsidies, and inflated captive sales to other state-run companies.
For the first half of 2005, Rulmentul Brasov claimed sales of €18.5 million (USD $22.2 million),
resulting in acknowledged losses of €1.73 million ($2.1 million).
For the full year 2005, company management has issued formal projections for results which many
observers believe are wildly optimistic -- sales reaching €47 million ($56.5 million), and
reversing the first half €1.73 million loss to a full-year profit of €530,000 ($637,000).
Management at the company, professing surprise that the losses continue unabated, once again
announced it is taking renewed efforts toward improving efficiency, more aggressively pursuing sales,
and taking steps to address its problems obtaining raw materials from vendors wary of its finances
and history of non-payment.
Early in 2005, the International Monetary Fund reached agreements with the Government of Romania
to enact a strict governmental and financial reforms package.
As part of that package, Romania has agreed to privatize or shut down its three largest money-losing
enterprises -- electrical equipment maker Electroputere Craiova, tractor plant Tractorul Brasov, and
bearing maker S.C. Rulmentul SA Brasov. The IMF deadline is December 31, 2005.
article: IMF cracks down on Romania; Rulmentul Brasov targeted
While Rulmentul Brasov has been on the market for a long time, the only recent interest was from Ortadogu
Rulman Sanayi (ORS, Turkey), which walked away from a USD $3.9 million bid after discovering the company
holding vast stocks of worthless bearing inventory, an impossibly large workforce guaranteed jobs, and finding
it would inherit massive debts, unpaid bills and unpaid wages. Adding insult, RBR's workforce walked out
several times to protest ORS's interest in the company.
AVAS Opens Rulmentul Brasov Documents, Requirements to Potential Bidders
AVAS had now set down serious bidding parameters for Rulmentul Brasov.
In an August 4, 2005 public notice, AVAS said it has placed all the necessary documents at
the disposal of potential buyers, and published a list
of documents, materials, deposits and other necessary requirements and specifications any
bidder for Rulmentul Brasov must meet. There are September deadlines for bidders.
The necessary information is available here on the AVAS website:
http://www.apaps.ro
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- by Bruce A. Carr
from individual research,
tips and commercial sources.
Unauthorized reproduction is prohibited.
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eBearing.com ... for everything that moves™
Entire contents Copyright 1999-2008, eBearing Inc. All rights reserved.
eBearing.com and "... for everything that moves" are registered
trademarks of eBearing Inc.
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eBearing.com ... for everything that moves™
Entire contents Copyright © 1999-2008, eBearing Inc. All rights reserved.
eBearing.com and "... for everything that moves" are registered trademarks of eBearing Inc.
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