Serbia paid USD 40 million for Zelezara Smederevo? - Government promised to settle steel mill's debt to U.S. Steel Kosice

(Zelezara Smederevo)

U.S. Steel did not get only one US dollar for Smederevo-based steelworks, but USD 40 million, Blic daily reveals after gaining insight into the sales agreement. Namely, the company U.S. Steel Serbia owed money to Slovakia's U.S. Steel Kosice, and that debt was inherited and paid by Serbia.

It was a debt of over USD 53 million, but the Americans accepted to write off 25 percent of it, so that Serbia paid about USD 40 million for the steel mill in Smederevo.

According to aforementioned agreement, the Serbian government, as the buyer, was obliged to pay Zelezara's debt of USD 53,180,000 for delivered raw materials, parts, equipment, computer and management services. That money, as this document reads, was claimed by U.S. Steel Kosice.

The agreement sets out two options for paying the debt: the transfer of available funds from the account of U.S. Steel Serbia, or the payment within three days from the moment the transaction is completed.

Although the payment deadlines expired, the way in which the Serbian government paid the debt to U.S. Steel Kosice is still unknown.

On the other hand, U.S. Steel Kosice also had certain obligations towards the Serbian government. They were bound by the agreement to leave the working capital in the amount of USD 110 million to Serbia. As it was agreed, this amount had to be confirmed within 10 days from the moment the transaction was closed.

- If it turns out that the amount of working capital of U.S. Steel Serbia was below the agreed level, the company from Kosice is obliged to pay the difference within five days - reads the agreement.