SOFIA, Bulgaria (AP) — Bulgaria's largest steel maker Kremikovtzi is set to be sold to Ukrainian steel tycoon Konstantyn Zhevago, the plant's CEO said Friday.
Alexander Tomov said acquisition talks with Zhevago for a majority stake in the plant were ''in the final phase'' and a deal was to be reached ''within 48 hours.''
He also said that Kremikovtzi's current majority owner, India's Global Steel Holdings Ltd, owned by Indian steel tycoon Pramod Mittal, had agreed to look for a new investor.
''Talks are being held with Mr. Mittal's consent. The deal will happen, it is inevitable now,'' Tomov told Bulgarian National TV. He said Zhevago was the potential buyer but did not give details about the deal.
The current owner had failed to provide investment of up to $206 million, needed mainly for environmental upgrades at the plant, which is located just outside the capital, Sofia, and is considered one of the main polluters of the 1.2-million city.
Zhevago, 34, a billionaire with interests in banking and mining, controls a majority stake in Ukraine's top iron ore producer, Ferrexpo.
Tomov said Zhevago was in control of raw materials needed for the iron smelter and had pledged to finance environmental upgrades.
In 2005, Global Steel Holdings acquired a 71-percent stake in Kremikovtzi, pledging to invest $300 million in the steel mill over the next three years.
The mill is the largest steel maker in Bulgaria, employing 8,000 people who staged protests earlier this year to demand their overdue salaries to be paid.
Unions asked the government, which owns 25 percent of the mill, to cancel the deal with Pramod Mittal, accusing him of poor management and exposing the plant to the risk of being closed down because it did not meet emission standards.