The Bulgarian state-owned National Electric Company (NEK), the largest creditor of insolvent local steel mill Kremikovtzi, has agreed to capitalize the money the steelmaker owes it, Sofia News Agency has reported citing Kremikovtzi's administrator Tsvetan Bankov.
Accordingly, by holding 59,726,620 of Kremikovtzi's shares, NEK would become the majority shareowner of the Bulgarian mill.
As SteelOrbis previously reported, by November 9 Kremikovtzi's shareholders had to make a final decision on the mill's recovery plan, which involved the recapitalization of the mill's debts owed to creditors via conversion into Kremikovtzi shares.
According to Mr. Bankov, so far 14 out of 59 Kremikovtzi creditors have expressed their intent to transform their claims into shares in the mill; however, negotiations are still continuing as no compromise has yet been reached.
On the other hand, Bulgaria's minister of economy, energy, and tourism, Traicho Traikov, has stated this week that Kremikovtzi is to be liquidated, as it is a "fake industrial entity."
Meanwhile, the workers of the bankrupt steel mill are awaiting delayed salary and social security payments, which are reported to total BGN 56 million (43 million). Currently, Kremikovtzi, which is considered to be a victim of a long-standing general mismanagement, employs about 3,170 workers, while over 3,000 workers have been dismissed or have left the plant.