After recent police raids and the launch of a fraud and tax evasion investigation, Liberty Galati, Romania’s largest steel producer, continues to face a deepening financial crisis. The company, which has been struggling for survival and faces the threat of bankruptcy, is reported to be waiting for government support to avoid a complete shutdown. Despite these difficulties, Liberty Galati’s management has expressed interest in a potential acquisition. According to local media, the company has internally announced plans to take over Phoenix Slag Services SRL, the firm responsible for slag processing operations and equipment management at the Galati steelworks.
Phoenix Slag Services SRL, fully owned by Phoenix Services Europe Cooperatief U.A. (Netherlands), is also among Liberty Galati’s major creditors, holding a secured claim of over 33 million lei (€6.6 million). Other key creditors include EXIM, ANAF, Galati Municipality, BRCI, Govcrest International and Aposol SAS, reflecting the wide scope of Liberty’s financial obligations.
Financially, Phoenix’s situation has deteriorated significantly in 2024, with the company reporting losses exceeding 17 million lei after more than a decade of consistent profitability. In the previous three years alone, Phoenix recorded profits of 23 million lei in 2021, 20 million lei in 2022, and 8 million lei in 2023.
As a result, the planned acquisition has drawn mixed reactions from market participants. Some interpret it as a strategic step to streamline operations and manage existing intercompany obligations, while others view it as a cautious but complex financial maneuver amid Liberty’s ongoing challenges. Given the company’s strained liquidity and limited progress on restructuring or potential sale efforts, the market remains cautiously watchful, viewing the development as part of Liberty’s broader attempt to stabilize operations under difficult economic and financial conditions.
