Liberty Ostrava considers acquisition of energy supplier Tameh Czech

Czech steelmaker Liberty Ostrava, a subsidiary of UK-based Liberty Steel, is seeking to negotiate lower prices and volumes with Tameh Czech and has made a takeover offer for the insolvent energy producer, Reuters reports.

The crisis is hampering both companies. Liberty continues to negotiate with Tameh to restore power supply. This would allow the company to restart blast furnace No. 3 at its Ostrava plant.

Liberty European Upstream Business Executive Director Teuns Victor told Reuters that the company is in the process of finalising a proposal to be sent to Tameh. It will state that if the energy supplier does not want to restructure, the next step may be the sale of the Liberty asset.

In the event that the negotiations with Tameh fail, Liberty is preparing an alternative plan to install electric compressors to provide hot blast for the blast furnace in Ostrava. Discussions are currently underway with potential equipment suppliers. This move will improve efficiency and therefore reduce costs, as well as significantly reduce carbon emissions.

Last October, Liberty shut down blast furnace No. 3 at its Ostrava steel mill, and in December it secured a three-month moratorium on debt payments, allowing it to present a restructuring plan. Tameh, the only energy supplier to the plant, filed for bankruptcy in mid-December 2023, announcing that it could not continue to operate due to unpaid debts to Liberty Ostrava.

As GMK Center reported earlier, the restructuring administration has discovered that Liberty Ostrava is bankrupt, putting the previously announced restructuring plan at risk of failure. A proposal to lift the general moratorium on debt repayment was submitted to the regional court. The company, in turn, stated that it is solvent and continues to comply with its obligations under the moratorium.

Liberty Ostrava is an integrated steel plant with an annual production capacity of approximately 3.6 million tonnes. The company mainly serves the construction, engineering and oil and gas industries. The company is a leader in the production of road fencing and pipes in the Czech market. In addition to the domestic market, the company supplies its products to more than 40 countries.