Doosan IMGB, the biggest manufacturer of complex industrial equipment in Romania, with 400 employees, announced that it would suspend its activity starting 2020, Ziarul Financiar daily informed.
The news came after another major industrial complex in Romania, ArcelorMittal Hunedoara, announced the temporary suspension of production invoking the same reasons: shrinking demand and rising energy costs faced by local factories.
The electricity and natural gas prices, paid by industrial consumers, is higher than in other European countries with important operators in steel production, ArcelorMittal officials explained at that time. In 2018, Doosan IMGB reported a turnover of RON 249 million (EUR 55 mln) and about RON 25 mln (EUR 5.2 mln) losses.
The industrial platform IMGB, owned by Korean group Doosan, will close next year, according to the agenda of the General Meeting of Shareholders (GMS) published in the Official Gzette. Sources close to the company explained to Ziarul Financiar that the operations will be suspended for at least one year, most likely starting with March or April 2020.
Talks with the trade union will be started for the termination of employment contracts and for the granting of severance payments to the employees.
The decision to cease operations in Romania is explained by the management as a result of the low orders and the increased production costs.
Doosan took over IMGB in 2006 from Norwegian company Kvaerner for USD 26 million.
The Norwegian group bought the industrial platform IMGB, one of the biggest of such kind developed during the communist regime, in 1998, for about USD 10 million, out of which only half a million was paid in cash and the rest stood for the factory’s debts.
Global steel group ArcelorMittal announced that, starting December 1, it temporarily suspended production at its steel...