Vorskla Steel, controlled by Ukrainian billionaire Konstaitn Zhevago, is preparing to join the operative management of debt-ridden Bulgarian steel maker Kremikovtzi, Zhevago's representative in Bulgaria Viktor Demyanyuk said.

"A meeting is scheduled on Monday [August 18] with executives from [gas supplier] Bulgargaz, [power utility] NEC and [railway carrier] BDZ to negotiate a repayment scheme [for Kremikovtzi's debts]. Consultants will be hired immediately in connection with the environmental program that will have to be implemented," Demyanyuk said.

In July, Vorskla Steel signed a subcontracting agreement with Kremikovtzi. Some of the managers of the Bulgarian company later said the agreement was signed under coercion and notified prosecutors.

Although the agreement was declared null and void by the managers that opposed it, Vorskla continued to supply input materials to Kremikovtzi with the management of the Bulgarian steel maker constantly delaying the recognition of the arrangement by suggesting a series of annexes.

On August 15, Demyanyuk said the plant will produce 60 000 to 70 000 tons of steel per month in the first 60 days. An upgrade that will be launched immediately will later increase the output to 95 000-105 000 tons per month.

Kremikovtzi receiver Ana Milenkova said she has not approved for implementation either of the subcontractor agreements Kremikovtzi has signed - with Vorskla Steel and with India's Arcelor Mittal. "There are two contracts and both of them should be honoured," she said.

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