In less than twenty months, the National Tabacco Company (CAT) consumed over 13% of its assets. As a result, the private firm that purchased CAT from the state has reduced its payment by DR$54 million (around US$3.4 million). A Spanish company, Cita Caribe, took title to CAT on the fifth of this month, and immediately became aware that between consumption of inventory, and unusable or damaged inventory, the value of the company’s assets had dropped to US$21.6 million, from the US$25 million that was bid by Cita Caribe on July 31, 1998. The director of the Council of State Enterprizes (CORDE), Eduardo Selman, explained that CAT didn’t stop operating just because of the appraisal and bidding process. The privatization process is known in the DR as "capitalization," a concept which provides for the state to retain 50% ownership of former state-owned businesses, but without taking an active role in management.
