Steel in­dus­try’s re­struc­tur­ing plan

Kathimerini English - - Focus - BY ANESTIS DOKAS & YIAN­NIS PAPADOYIANNIS

The count­down­has started to the re­struc­tur­ing of Greece’s steel in­dus­try, one of the coun­try’s most overindebted sec­tors, with to­tal ar­rears of 1.2 bil­lion eu­ros.

Last Thurs­day, Al­varez & Marsal sent its study for the in­dus­try’s re­struc­tur­ing to the cred­i­tor banks and Kathimerini un­der­stands it has pro­posed the clo­sure of at least one pro­duc­tion unit, the fur­ther re­duc­tion of op­er­at­ing ex­penses at other units, merg­ers, the en­try of strate­gic in­vestors to bring in cap­i­tal and know-how, and a sig­nif­i­cant re­duc­tion of obli­ga­tions so as to re­sult in a sus­tain­able in­dus­try.

The study’s ob­jec­tive is to make the new op­er­at­ing model in­ter­na­tion­ally com­pet­i­tive, which can only be achieved through a gov­ern­ment in­ter­ven­tion to re­duce en­ergy costs. Other­wise, bank of­fi­cials note, the in­dus­try is doomed to keep adding to its losses, which banks are un­able to fund any longer.

Greek steel is of the same qual­ity or in some cases bet­ter than that made else­where in Europe, but it is not com­pet­i­tive due to its huge en­ergy costs owing to the high elec­tric­ity and nat­u­ral gas rates steel­mak­ers pay. Of Greece’s five steel plants, only four are still op­er­at­ing, as the Hel­lenic Ha­lyvour­gia plant at Aspropy­r­gos has closed.

Four steel plants re­main in op­er­a­tion in Greece after the clo­sure of the unit at Aspropy­r­gos.

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