Bulgaria's Cabinet will ask local steel maker Kremikovtzi to pay back the state aid it received before it was put in private hands eight years ago, a Government source told Dnevnik on August 20.

The Cabinet will ask for its money back before September 8, the date by which all Kremikovtzi creditors have to submit their claims to the interim receiver appointed after the steel maker was declared insolvent. The next step will be to determine the size of the claims that will be approved and the votes that the creditors will be assigned for the September 24 creditor meeting.

"The exact amount of the state aid is being calculated together with interest for the period since 1999," the source told the newspaper.

The state aid principal alone is estimated at over 430 million leva. In July, Economy Minister Petar Dimitrov said taht the state aid totaled close to 700 million leva with interest.

If Kremikovtzi's outstanding payments to various state-owned service providers are factored in, the amount that the government could claim from the debt-laden steel maker would rise to over 900 million leva, ensuring that the Government will hase the decisive vote as a creditor.

The Cabinet has said Kremikovtzi started this week the implementation of a subcontractor agreement with Vorskla Steel, a company controlled by Konstantin Zhevago, the Ukrainian billionaire interested to buy the steel maker.

Under the agreement, gas supplies to the steel plant should be resumed this week so that monthly output could rise to 60 000-70 000 tons. Production should reach 100 000 tons within two months after an upgrade of the plant's converters.

The same source told Dnevnik that by joining the operative management of the plant, Zhevago's people now have the edge over rival bidder Arcelor Mittal.

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