The only steel company in the Baltic states, Latvia-based Liepājas Metalurgs, has agreed with one of the leading Italian banks, UniCredit MedioCredito Centrale, on a €85.597 million loan with state guarantees, to be used for the completion of the second phase of its modernization program.
Initially, Liepājas Metalurgs was planning to obtain a financing amount of €160 million for the modernization of its production facilities. In April 27, 2009 the company announced a financing tender, which on June 19, 2009 ended with no result, since no offers were received.
Taking into consideration the global economic situation, and following successful negotiations, Liepājas Metalurgs has managed to almost halve the modernization project costs, without reducing the scope of the project.
Liepājas Metalurgs plans to modernize its steel smelting production facilities, replacing its three open hearth furnaces, which are operating at the plant since 1965, with modern electric furnaces. The modernization of the company's melt shop is the necessary requirement for the continuation of its operation and the security of jobs.
In addition, Liepājas Metalurgs also plans to construct a new rolling shop, with an annual capacity of 450,000 mt. This will allow the steelmaker to produce not only rebar for concrete structures, but also a wide range of other products that will reduce its dependence on the situation in the construction market.
Liepājas Metalurgs manufactures low carbon and low alloy steel products, including reinforcing bars, steel wire and castings.