ArcelorMittal owned by steel tycoon Lakshmi Mittal was interested in buying Sofia's Kremikovtzi steel mill currently owned by Mittal's younger brother Pramod Mittal, Bulgarian news agency BTA said on April 16 208.
BTA quoted anonymous representative of AcelorMittal who met with Bulgaria's Economy and Energy Minister Petar Dimitrov to discuss Kremikovtzi's faith. “There is an interest in the deal but there is no deal yet,” ArcelorMittal representative said.
According to Sunday Times Lakshmi Mittal has offered to pay around 50 million euro for Kremikovtzi, just one third of the 150 million euro that Pramod values it at.
When Pramod Mittal bought Kremikovtzi he paid a total of $110 million (69 million euro against current exchange rate), Kremikovtzi's previous owner Valentin Zahariev told Bulgarian National Television on April 15 2008. “The deal did not cost Pramod anything because he used bank loans which he later covered with Kremikovtzi's bond issue,” Zahariev said
The meeting at the Economy and Energy Ministry took place while hundreds of Kremikovtzi workers protested in front of the mill's building against delayed payments of their salaries. The protest started on April 15 2008 and is gathering pace.
Dimitrov has said that the Cabinet would agree to any investor ready to start pouring money into Kremikovtzi's viability plan, which included measures to cut down emissions, and prevent the company from amassing any more debt toward state utilities NEC and Bulgargaz, as well as railway BDZ, respectively for electricity, gas and deliveries of raw materials.
The holders of Kremikovtzi's 325 million euro bond issue, who are pressuring Pramod into selling his stake, are ready to liquidate the mill's assets unless they find an investor willing to pay out 101 per cent of the bond principal. Bulgaria's Government has staunchly maintained that it would block any move in that sense. .
Kremikovtzi's strike coincided with massive protests held in Romania's biggest steel plant owned by ArcelorMittal in Galati Eastern Romania. Raising demands for higher pay thousands of workers stormed the gates of the plant. EuroNews showed guards using force to stop the protest and some reports claim that guards used tear gas on the striking workers.
