Russian group Mechel has put all of its companies in Romania up for sale, in an assets restructuring move which also includes sales of holdings in other countries. Mechel announced the move after its board of directors meeting earlier this week, but did not give any specific details about the sale.
According to Russian media, Mechel is asking for some USD 150 million for the four subsidiaries it has in Romania. Mechel Targoviste has an asking price of USD 46 million, according to Kommsersant.ru, while Ductil Steel Buzau, USD 39 million. The Russian company bought the latter in 2008 for some USD 198 million.
Mechel Campia Turzii and Laminorul Braila have similar asking prices, USD 33 million and USD 32 million. The numbers were not yet confirmed or denied by the company.
Mechel announced it plans to sell enterprises that make up Mechel’s Eastern European Steel Division S.R.L.- which runs the Romanian holdings for the group, as well as, Donetsk Electrometallurgical Plant PJSC (Ukraine), Invicta Merchant Bar Ltd. (UK), UAB Mechel Nemunas (Lithuania), Mechel Service Global B.V. (except Mechel Service OOO (Russia)), Voskhod-Chrome LLP (Kazakhstan), Voskhod-Oriel LLP (Kazakhstan), Tikhvin Ferroalloy Plant OOO (Russia), Southern Urals Nickel Plant OAO (Russia), Kuzbass Power Sales Company OAO (Russia), Toplofikatsia Rousse EAD (Bulgaria).
According to Kommsersant.ru, the asking price for the entire batch is USD 860 million, less that half of the acquisition price of these assets.
After the sale announcement, Mechel’s CEO Yevgeny Mikhel mentioned the company’s “course on improving our operational efficiency, development of those investment projects that are most promising from an opportunity costs standpoint, and will enable us to focus on priority business areas, work on systematically reducing the level of indebtedness and improving the company’s shareholder value.”
Mechel’s turnover in Romania stood at EUR 1 billion last year, but the lack of orders impacted its local business. Mechel makes steel products in Romania, where it employed some 7,500 people at the end of 2011.
Corina Chirileasa, [email protected]