ECONOMY

Petzetakis sells Vechro stake

Petzetakis, the plastic pipe manufacturer, said yesterday it had sold its 84 percent stake in paint company Vechro to an unnamed buyer for 7 million euros in line with a cash-raising strategy aimed at reducing its mountain of debt. Last week, the company said it aims to sell off its non-core activities, using the proceeds to pay off debts amounting to 125 million euros. The debts were related to a string of acquisitions made over a period of 11 months, which gave the company a foothold in Spain, Italy, Canada, Germany and South Africa. In addition to a payment of 7 million euros, the buyer also agreed to take on Vechro’s bank loans of 10.6 million euros. The disposal will slash 17.5 million euros off the group’s bank debts and strengthen its capital by 4.7 million euros, Petzetakis said. Vechro’s sales amount to 7 percent of consolidated sales. The company posted a marginal increase in profits in 2001 and in the first nine months of this year. Petzetakis said last week that the disposal of non-core activities is expected to generate 25 million euros for its debt-reduction program. The company last month appointed Giorgos Petzetakis managing director after a management shake-up led to the departure of Managing Director Pavlos Triposkiadis and Chief Financial Officer Ioannis Cottis. It also implemented a simpler organizational structure. Petzetakis posted group profits before tax and minority rights of 825,000 euros in the first nine months of the year, against a loss of 3.44 million euros in the same period last year. Its shares rose by 3.23 percent yesterday to close at 1.60 euros. The stock has lost more than two-thirds of its value since the beginning of the year.