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Seven investors submit offers for running Kremikovtzi

Date: 15.12.2008

Bulgaria's Economy Ministry has received seven offers with bids for the purchase or the operation of the troubled steel-maker Kremikovtzi, the Trud Daily reported Thursday.

The paper points out that the most serious bidder is the Ukrainian company Smart Group which offers an emergency plan for saving the factory, and a longer-term recovery program by restructuring and acquisition of new assets. It is expected to present its demands about Bulgarian state guarantees for Kremikovtzi within several days.

The Czech company ML Moran offers to finance Kremikovtzi enabling the plant to buy raw materials, and manufacture and sell its production. The bulk of the revenue, however, would go to the creditor so the main advantage of this plan would be to keep the factory running.

Each of two other foreign companies - the Russian Prominvest, and an unnamed Italian company - are offering to provide raw materials, and working capital for Kremikovtzi in exchange for guarantees by the Bulgarian state.

The former owner of the steel mill Valentin Zahariev, who sold the plant to the Indian tycoon Pramod Mittal in 2005, has offered to run the plant after setting up a new firm for the purpose. In the event of liquidation of the factory, however, he is asking to be allowed to buy out the assets on sale.

The Bulgarian metal wastes trader Econmetal Engineering, whose facilities are located nearby Kremikovtzi, is offering to provide 60 000 tons of raw materials for the steel-maker in exchange for being allowed to realize the manufactured products on the market after that.

A group of bond holders is offering the factory a credit of EUR 345 M in exchange for Bulgarian state securities with a redemption date in 2013.

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