UralVagonZavod is the name of the Russian company which is interested in purchasing the Zelezara Smederevo steel mill in Serbia, according to the Serbian newspaper Blic. The company is an important industrial group operating in the field of military vehicles (tanks constitute 20 percent of its production), rail cars, excavators, tractors and metallurgical products.
Negotiations between the company and the Belgrade government are said to be at an advanced stage. As reported by SteelOrbis, earlier this week the Serbian government launched a new tender for the sale of 75 percent of the steelworks, while the government has imposed strict requirements for interested investors which are fully satisfied by the Russian group. In addition, UralVagonZavod CEO Oleg Sienko has confirmed the ongoing negotiations to Russian business newspaper Kommersant, although he stressed that a final agreement has not been reached yet. Mr. Sienko said that the Smederevo-based steelworks could establish important synergies with other foreign assets of the group.
Sources close to the negotiations, however, believe that the tender launched by Serbia has complicated the negotiations, because the intention of UralVagonZavod was to obtain the former US Steel Serbia for free or nearly for free given the huge investment necessary to reignite the two blast furnaces and to modernize or replace obsolete production capacities.
Serbian economy minister Mlađan Dinkić recently stated that he expected production would be relaunched at the Smederevo plant by the end of the current year, as reported by SteelOrbis.
At the end of January this year, the Serbian government bought back the Smederevo plant (then called US Steel Serbia) from Pittsburg-based US Steel for a symbolic amount of $1.