Zelezara soon with full capacity – Nine companies participate at tender

Zelezara Smederevo (Photo: zelsd.rs)

Deadline for delivery of letters of interest for privatization of Smederevo-based Zelezara, expired. As RTS finds out, so far nine companies applied, and the offer of the American Esmark is estimated as the most serious one.

The Government says that in the next few days they will pick up the privatization model and by the end of the week they will release transparent tender in line with EU regulations. If it is to judge by the number of the interested investors, better days are coming for Smederevo-based steel plant.

The Government confirmed that privatization procedure will end in January, by the Christmas. They will wait for the strategic partner working.

The plan is to quickly put the second high furnace into operation as well so that production would reach forecast capacity of 2.200.000 tons of steel per year. If it steps into Zelezara, Esmark group promises there will be no layoffs and it announces big investments.

The Government says they will chose strategic partner which complies with the majority of terms and which will bring Zelezara annual turnover of one billion and four hundred thousand dollars.

It is very important for the state to solve as soon as possible the issue of Zelezara because it annually sets aside more than USD 100 m for its operations.

RTS finds that by December 1, 2014, the following letters of interest arrived:

1. "Krasni Oktobar", Volgograd (Russia)
2. "United Group SA", Luxemburg (Luxemburg)
3. "RE Alloys SP ZOO", Laziska Gorne (Poland)
4. "United Machinery Corporation", Moskva (Russa)
5. "North London Trade Centre Limited", London (GB)
6. "Esmark Europe B.V", Amsterdam (Netherlands)
7. "Prominvest AG Switzerland", Lugano (Switzerland)
8. "Steel + Metal One Holding AG", Zarnen (Switzerland)
9. "Rafflesia Trading Pvt. Ltd", Chittagong (Bangladesh).