Serbia invites bids for majority stake in Zelezara

BELGRADE - Serbia's Privatization Agency Friday sent out a public invitation to parties interested in becoming a strategic partner in Zelezara Smederevo by purchasing an 80.01 percent stake in the steel producer, with the state retaining ownership of the remaining 19.99 percent stake in the entity, to submit their bids by January 5, 2015.

Privatization documents will be available to interested parties from December 9, and requests for purchase of the documents should be submitted to the Privatization Agency by December 22, according to the invitation.

The paid cash capital of Zelezara Smederevo amounts to RSD 16.74 billion and its non-cash capital amounts to about EUR 2.7 billion.

Potential investors are entitled to bid if their income totaled at least USD 300 million in each of the last three accounting years.

The winning bidder will be under obligation to restart the second blast furnace at the steelworks and push its output to at least 50 percent of production capacity, while maintaining full production capacity at the first furnace, by the end of 2016.

The Serbian government decided on Thursday to launch the process to privatize the steel producer through the selection of a strategic investor who would acquire an 80.01 percent stake in Zelezara through a capital increase of the privatization entity.

In January 2012, the Serbian government bought back Zelezara from U.S. Steel for USD 1, and anounced the first invitation to tender privatization bids in April the same year.

The value of production at Zelezare Smederevo is about EUR 340 million, and with a production at full capacity, it would reach EUR 1.5 billion.

The government supports production at the plant with about EUR...