The plants for the production of steel in Serbia, again for sale

Serbia repurchased the steel production facilities of the Zelezara Smederevo plant from US Steel for one dollar in 2012. All this to prevent its closure and the loss of jobs for 5,000 employees, but the 100 mil. Euro ($126 million) subsidy from the state has already been swallowed due to the loss of the factory. The government made a state offer to recover the huge debts.

The privatization agency will start the operation on Friday. It was announced on October 30 of this year by the Reuters news agency. Investors have 30 days to submit letters of intent regarding the privatization of the plant.

A day before, Prime Minister Aleksandar Vucic said that the files will be analyzed after the deadline. And „all sales procedures will be completed by February”.

Steel production facilities

The plant has debts of 370 million Euros. The sale of the furnaces and other state-owned assets, such as Telekom Serbia. Are crucial to the government’s hopes of consolidating the budget, which has an 8% deficit.

The company Esmark Europe, part of Esmark Ing, one of the largest distributors and producers of pipes in the USA, has confirmed its interest in Zelezara.

There was another privatization attempt in 2013, but that only received offers from Uralvagonzavot from Russia, an offer rejected by the government.

State subsidies for companies were limited in Serbia by the IMF as a precautionary measure.

Vucic said that the government is considering hiring a consultant for the sale of Telekom Serbia, given that state subsidies exceed 3% of GDP.

The two furnaces from Zelezara are still working, Vucic expecting that the eventual comparator will increase the annual production of steel, from 380,000 tons to 2 million tons, with a profit improved by 1.5 million Euro compared to the current one of 320 million Euros.

Source: http://finance.yahoo.com/news/serbia-launch-fresh-bid-sell-154122093.html?soc_src=mediacontentstory