Liberty Galați has been given another 30 days to avoid bankruptcy

The situation at Romania’s largest steel plant, Liberty Galați, remains critically tense. On July 7, a court in Galați extended the deadline for agreeing on a restructuring plan for the company, which has been in preventive bankruptcy proceedings since March 2025, by 30 days. If the plan is not approved by August, the plant faces complete bankruptcy, according to local media reports.

The court’s decision temporarily protects the company from enforcement actions by more than 1,200 creditors, to whom Liberty Galați owes more than €400 million. The main creditors remain EximBank (€300 million) and the ANAF tax service (€150 million). The latter has already rejected the restructuring plan twice, even though the company agreed to pay off the debt in 42 months.

Against the backdrop of growing debts of 4.25 billion lei (almost €860 million) and losses of 1.6 billion lei in 2024, the management company Euro Insol announced the termination of its contract with Liberty Galați. In a letter to the court, the administrator accused ANAF of blocking the process and the plant’s management of inaction and lack of real participation in crisis management.

Despite the financial crisis, Liberty Galați resumed operations of its thick sheet rolling mill in early July, a key unit for the production of steel for infrastructure, shipbuilding, and pipe products. However, the launch of production automatically increased the plant’s daily costs to almost €4 million, putting additional pressure on its already unstable finances.

The critical nature of the situation prompted an open response from the authorities: parliamentarians, local officials, and MEP Dan Nica called on the government to intervene immediately, warning of the risk of social unrest and economic collapse in a strategic industry. Liberty Galați remains the largest steel producer in Romania, employing over 4,500 people and another 3,000 in related industries.

In March this year, it was announced that Liberty Galați would receive state support to resume operations. According to Romanian Economy Minister Bogdan Ivan, the company will play an important role in supplying raw materials to defense industry plants, in particular those in Brașov, Câmpulung, Sighișoara, and Dragomirești.

On March 5, the court ruled to initiate a preventive process at the company, providing temporary protection from debt enforcement. The plant had two months to present a restructuring plan to its creditors. As noted, the plant found itself in difficulty due to the consequences of the war in Ukraine, high energy prices and large volumes of imports from outside the EU, as well as new US tariffs on steel imports.