Romania agrees to sell separately core assets of Liberty Galati steel mill

The government of Romania, the main creditor of the integrated steel mill Liberty Galati, part of the Liberty Steel group but currently under pre-insolvency procedure, agreed with the sale of the company’s core assets separately, according to Ziarul Financiar, citing the independent manager of the company set under the pre-insolvency procedure, Remus Borza. The executive had previously insisted on the sale of the company as a whole.

The value of the core assets is evaluated at between EUR 800 million at the market price and EUR 400 million at the liquidation price, Remus Borza told the daily.

The international auction could be held within a couple of months.

“Selling at the international auction is the fastest method by which we can liquidate the company, close the liabilities, and cover the secured debt, salary, and part of the unsecured claims,” Borza said.

Sources familiar with the negotiations indicated that Jindal of India expressed its interest in the Romanian steel assets, along with the giant MetInvest, controlled by billionaire Rinat Akhmetov, and the Romanian entrepreneur Dorinel Umbrărescu, the largest road construction contractor.

Liberty Galati is owned by the Liberty Group, which is in turn owned by Indian-British investor Sanjeev Gupta. The company entered into a preventive arrangement in March to stabilise the business.

Romania’s tax collection agency, ANAF, has to recover EUR 150 million from Liberty, and state-owned bank Exim has to recover EUR 300 million. There are also 1,197 unsecured creditors on the list (service providers, suppliers of raw materials, materials, utilities, others). Liberty entered this preventive arrangement procedure with total debts of EUR 1.2 billion.

(Photo source: the company)