Fitch: Petrom on positive watch

Fitch Ratings said it placed SNP Petrom SA's and its €125 million eurobond issue's senior unsecured BB- ratings on Rating Watch positive.

This follows the announcement by the Romanian Ministry of Economy and Commerce that it will begin direct negotiations with Austria's OMV AG on Petrom's privatization. The short-term rating is B.

Fitch noted that while the ministry wants to conclude Petrom's privatization and sign the privatization contract soon, no firm timetable has been given and Fitch believes that delays (as witnessed in the previous stages) are possible and execution risk is present. Nevertheless, it is becoming increasingly likely that the privatization will be concluded in the short term and that the associated share capital increase will strengthen Petrom's stand-alone credit profile, possibly allowing a rating upgrade.

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