Russia's UVZ to offer investment model for troubled Serbian steel mill.

By bne IntelliNews January 14, 2013
Serbian finance minister Mladjan DInkic said Russian state-owned machine-building company Uralvagonzavod (UVZ) will visit Belgrade in the first half of February to offer a cooperation model for launching production at steel mill Zelezara Smederevo. Dinkic was quoted as saying on the government's website that UVZ has completed the technical and technological analysis for potential investment in the troubled steel producer. Dinkic was speaking after his visit to Russia last week. He also met executives from Russia's VTB Bank and held talks with them on the possibilities to finance projects in Serbia. Dinkic said that an agreement with the lender on financing large investments necessary for launching full-stream and profitable production at Zelezara Smederevo was reached. The Serb state bought back Zelezara from US Steel for a token price of USD 1 at end-January but has halted its production since July 10 because the company was unable to cope with the unfavourable global market prices and the lack of raw materials. If Serbia manages to soon complete the sale of Zelezara and restart its production, this would have a significant positive impact on the country's economic performance since Zelezara had a 12% share in Serbia's exports and accounted for 5% of the country's industrial output.

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