Competition for PHS privatisation gets severe

Competition for PHS privatisation gets severe

The state treasury in Poland extended the initial deadline of May 21, for choosing a partner for negotiations to May 27, as LNM had not made its official bid as of the former date. The rival bidder US Steel pushes for the decision to come out by the May 27 deadline as it is eager for a fast decision to proceed with its bid. The details of the offers are kept confidential as per the terms and conditions of the tender held for the privatisation of PHS, the consolidated steel mill group that accounts for almost the 70% steel production in the country. PHS mills are expected to be handed over against €230 million-€690 million (zl 1-3 billion). There are speculations in the industry that the delay of the deadline is caused by some last minute changes in the tender terms such as the treasury taking out the coke production facility out of the PHS group or transferring some assets to the Industrial Development Agency. It appears that US Steel is against the coke facility to be taken out of the deal and hopes that it is kept as a part of the PHS. As there are commitments under the EU accession agreement, the purchase needs to be completed at the soonest possible time, according to the US Steel representatives. The government will be allowed to subsidize PHS for a certain period of time after the accession to the EU, in return for a capacity reduction by one million ton per annum. The rival bidders LNM and US Steel are both interested in strengthening their operations in central Europe. The forthcoming days will tell which of the two companies will be the one to take further steps in this respect.