Liberty Galati to be put up for auction again: reports
As it became known to Callanish, the troubled Romanian metallurgical plant Liberty Galati has submitted a new restructuring plan to the Galati court in Romania and is likely to be put up for auction again.
According to Romanian media reports, the plan was presented by two restructuring administrators, Euro Insol and a subsidiary of CITR Galai.
The key offer is the sale of the company through open bidding. The initial price of the asset is set at €444 million ($522m), according to Vesti. A COPY of the report.
According to the document, the sale of the plant as a single property complex is considered the most acceptable option for maintaining production operations and jobs.
"It is expected that the auction will attract a new owner who is able to provide the necessary investments in working capital and modernization of its facilities," the report says.
The price of 444 million euros has been reduced to 70% of the original asking price of 709 million euros. This amount is the minimum threshold that will partially repay the debt owed to senior creditors. The plan stipulates that the new investor will receive assets free of historical debts, which should increase the attractiveness of the asset for major international players in the industry.
In March, the auction for the sale of Liberty Galati did not take place due to a lack of bids.
Liberty Galati did not respond to Callanish's request for comment before the publication deadline.
Liberty Galati is in a difficult financial situation due to high debt levels and unfavorable conditions in the European steel market. Over the past year, the plant has repeatedly faced operational disruptions, including the shutdown of blast furnace No. 5 and a shortage of raw materials.
The organizers of the restructuring note that previous attempts at internal financial recovery have not led to the desired results, which makes the change of ownership a necessary step to prevent bankruptcy. In addition to the sale price, the buyer's commitment to invest in the transition to green technology will be taken into account.
The plant's capacity is about 2.5 million tons of steel per year for the construction, naval, oil and gas and energy industries. It was acquired by Liberty Steel Group from ArcelorMittal in July 2019.
Author: Svyatoslav Abrosimov
Kallanish.com