Poor chances for procurement of KAP by Rusal, but there is backup variant

President of Board of Directors of Aluminum Combine Podgorica (KAP) Mihailo Banjević estimated that the chances that Rusal changes its mind and accepts conditions of the Government of Montenegro concerning privatization of KAP, after unsuccessful negotiations, were very poor.

"Agreement on sale of majority package of Aluminum Combine to Russians has not been reached mainly because of 'formal-legal reasons', i.e. unreadiness of Rusal to offer full guarantees for Cyprus-based company Salamon enterprises, which was formed to manage KAP", said Banjević, a member of negotiations team. He pointed out that there was backup variant in case sale of KAP to Russian company Rusal failed, but he did not want to state precisely what was it all about.

The agreement between the governmental and Rusal's negotiations teams has not been reached even about the price of electricity because Russians did not agree "to increase price of electricity of € 20.44/MWh proportionally to the stock price of aluminum". Banjević explained that the price of aluminum on the world market was calculated in USD currency, which was decreasing, and that that increased production expenses of KAP since Montenegro used EUR currency as mean of payment.