Mittal offers to acquire Global Steel's ailing Kremokovtzi steel mill in Bulgaria

25 March 2008

Arcelor Mittal's L N Mittal has intensified his efforts to gain control over Global Steel Holdings Ltd's ailing Kremikovtzi steel mill in Bulgaria, run by his youngest brother, Pramod Mittal.

The mill faces the prospects of renationalisation by the Bulgarian government due to persistent labour unrest.

L N Mittal has written to the Bulgarian cabinet, pledging to restructure the mill and absorbing Kremikovtzi's outstanding liabilities of approximately around $1 billion.

Mittal is said too have assured a restructuring of the €325 million-bond and the state loan, settle late payments for taxes, social security contributions and other debts owed by Kremikovtzi.

Global Steel Holdings (GSH) has a majority stake in the ailing Bulagarian steel mill. A Global Steel spokesman said it had retained Merril Lynch to arrange for a strategic partner to join Global Steel in reviving Kremikovtzi, which was facing raw material shortage and other problems.

Ukraine's economy and energy minister Petar Dimitrov was quoted in a Bulgariqan paper as saying, Mittal had promised to improve the results of company in compliance with all environmental legislation at local, regional and international levels.