Troubled Romanian steelmaker Liberty Galati failed to find a buyer at the first international steel mill auction last week, Kallanish reports.
Although five investors purchased the specifications and analyzed the offer, none of them provided the necessary guarantees to participate in the auction, according to the Romanian newspaper Informat.
The main reason for the lack of bidders is that the asset price is considered too high and amounts to approximately 720 million euros ($826.4 million). According to Informat, the plant's administration says that investors are deterred by high operating costs for electricity, gas and CO2 emission certificates, as well as the age of the equipment.
It is assumed that the plant can be put up for auction again, but at a reduced price, which is estimated at 420-500 million euros.
Liberty Galati and Euro Insol, the company's arbitration manager, had not responded to Callanish's request for comment at the time of publication.
Among those who are believed to have expressed interest are industrial groups from India, China, Turkey, Ukraine and Iraq, as well as the Romanian company UMB Grup.
Other potential buyers include JSW Steel and Jindal Group from India, DeLong Steel from China, KMC Steel from Turkey, Galiawa Group from Iraq and Metinvest from Ukraine.
The Ukrainian group of companies is already present in Romania after the acquisition of the ArcelorMittal pipe products plant, which was completed in December.
Liberty Galati has amended the restructuring plan previously proposed by two administrators, which was approved by the Galati District Court.
The annual production capacity of the plant is about 2.5 million tons of steel for the construction, naval, oil and gas and energy industries. The plant was acquired by Liberty Steel Group from ArcelorMittal in July 2019.
In March 2024, the plant entered into a preventive agreement to avoid bankruptcy. Since then, the plant's operations have been seriously affected.
Last summer, Liberty Galati resumed operations at its steel plant after almost a year-long hiatus.
Author: Svyatoslav Abrosimov Bulgaria
Kallanish.com
