Hungary has extended the deadline for submission of proposals for the acquisition of Dunaferr

GFG Alliance (the parent company of Liberty Steel) and Vulcan Steel are currently competing for the venture

The Government of Hungary has extended the deadline for submitting tenders for the purchase of the Dunaferr steel mill until July 14, 2023. Fastmarkets informs about it.

The previous term expired on June 30, 2023 – it was extended on the eve of this date.

Currently, the two bidders for Dunaferr are Britain’s GFG Alliance (parent company of Liberty Steel) and Vulcan Steel, a private company based in Mauritius. Tender applications from other participants – the Ukrainian Metinvest group, the Swiss Trasteel Trading Holdind and the Hungarian Trinec Property were excluded.

According to Hungarian Napi.hu, according to the recently elected head of the industry steel association (Vas és Acélipari Egyesüles) Robert Moger, the survival of Dunaferr is a key issue from the point of view of the country’s economy. According to him, the capacity of the Hungarian steel industry still lags behind the production capabilities of other countries in the region.

Hungary currently has the capacity to produce approximately 2 million tons of steel per year (Ozd and Dunaujvaros), while the country’s industry requires 3.5 million tons of steel and steel products each year. It is expected that by 2030 this need will increase to 4 million tons.

At the end of December 2022, the Municipal Court of Budapest made a decision to eliminate Dunaferr ISD. The plant received a temporary administration.

As GMK Center reported earlier, steel plant has been idle since the third quarter of 2022. In December 2022, the Hungarian authorities asked Liberty Steel to ship coal to Dunaferr in order to avoid shutdown of the plant’s coke batteries, limited quantities were supplied to the company. In February 2023, the plant restarted blast furnace №2 and the cold rolling state, in March – the hot rolling state.

Hungary is making active efforts to launch the plant, in particular, the state has taken over the costs of paying wages in the amount of $44.8 million. The future owner of the enterprise has two requirements – preservation of the production process, including steel smelting, and full wages for all employees. He will also have to take on the costs of decarbonization of the metal plant.

In June, Dunaferr continued to operate under conditions limited capacities, as the bidding process for the steel plant continues. According to trade union sources and other persons close to the company, the company’s rolling mills are idle, and their work is expected to be resumed in mid-July. The plant has a rolled steel production capacity of 2 million tons/year, currently the steel plant produces only a fifth of these volumes.