published: 10.12.2013, 09:26 | updated: 10.12.2013 09:29:41
Ostrava - Russian steel producer Evraz will sell its Czech division Evraz Vitkovice Steel (EVS) to Russian bank Vnesheconombank (VEB) whose main task will be to financially stabilise the company before a new strategic investor takes it over, server Insider and daily Hospodarske noviny (HN) said.
Evraz said in August it is planning to sell the Czech company by the end of this year.
EVS spokesman Jaromir Krisica has not confirmed the sale yet.
The company will officially announce the sale this week after the transaction is concluded legally, Insider said.
VEB is a bank owned by the Russian state. It is also the biggest creditor of EVS.
However, VEB will not be the final owner of the Czech steel company but will only stabilise it financially, according to Insider.
Czech entrepreneur Zdenek Trojek, whose company Trojek Group trading in metal scrap is one of EVS's biggest suppliers, could become the new investor. Trojek Group's interest is the prosperity of the steel company, Insider said.
Trojek Group is in talks about buying EVS together with Czech entrepreneur Martin Ulcak. But Ukrainian group IUD also showed interest in the company, the server said.
Evraz bought the Czech steel maker, based in Ostrava-Vitkovice in northern Moravia, in 2005 for $285m (Kc5.5bn). It placed a higher bid than rival Mittal Steel.
EVS, which is the third biggest steel company in the Czech Republic, has been loss-making since 2009. There were several shutdowns in the company this year owing to small demand for its products.
EVS employs 1,100 people in total.
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