The Ministry of Economic Development announced on Tuesday that Liberty Steel became the winning buyer in the tender competition for the Dunaferr ironworks under liquidation. The order of the Capital Court also revealed that Liberty bought the company for 55 million euros, which corresponds to HUF 15.4 billion at today’s exchange rate. This was also stated by to vg.hu the Secretary of State:
- We consider the sale of Dunaferr an outstanding success precisely because liquidation in Hungary usually ends in closure.
- In the last 30 years, there are not many examples of a production company that has been liquidated and reorganized surviving.
- Last December, at the critical moment, the most pressing question in terms of Dunaferr’s survival was the provision of coal supply. Liberty finally secured coal from the Ostrava factory.
- But the journey was still adventurous, the government was quite active in the field to ensure that the shipment arrived on time. For example, the state secretary was in constant telephone contact with the managers of MÁV and Rail Cargo so that the train could travel on an accelerated track, which finally arrived at the last moment.
- In any case, this train really didn’t want to run, it stood for half a day at the Slovak-Czech border, while the locomotive had to be changed in Slovakia. By way of comparison: the first shipment of coal arrived here from Ostrava in 30 hours, the second in half that time.
- What happened to the ironworks only in December, not to mention the years before that, streaming providers could easily make a very exciting and complicated series out of it.
Gergely Csiki, Portfolio editor, came to a similar conclusion in the latest edition of Checklist, when he was asked about Dunaferr’s situation:
- The liquidation is still taking place, and in the coming weeks additional assets will be sold, including Dutrade, which is the majority property of Dunaferr.
- These revenues will eventually go to the company under liquidation, from where creditors will be satisfied based on the order in accordance with the law.
- The new owner cannot exercise ownership control until the EU approves the transaction, but in the meantime he will continue to work for wages, supplemented by the payment of wages.
- Liberty is the largest steel producer in Central Europe with ironworks in the Czech Republic, Poland and Romania. It is committed to green steel production, which is important from the Hungarian economic point of view because our country imports nearly 4 million tons of steel annually, while we export more than one million tons of steel waste.
- According to Liberty, it plans to switch to larger and higher value-added production in the future, and this is favorable for Hungary, which is also building a modern, 21st-century automobile industry.
- The government sees that Liberty is committed to the workers in both Ostrava and Galac, which is definitely promising for Dunaferr as well.
- This transaction is a very important milestone, it may be possible to stop for a moment, but there is still a lot of work to be done. The technology is outdated, and most importantly, we need to switch to green steel production.
- In its current form, the ironworks is not yet competitive: the company is awaiting reorganization and major restructuring. I won’t tell you a big secret, this will be the biggest part of the job.
Cover image source: MTI/Szilárd Koszticsák