Hungary’s largest steelworks in deepening trouble – liquidation started

The National Economy Ministry said on Tuesday that Hungary’s government has made “every effort” to save the Dunaújváros steelworks, while India’s Liberty Steel, which acquired the steelworks in a liquidation procedure, has “failed to fulfill its commitments.”

The ministry said Liberty had pledged to gradually ramp up production at the steelworks from zero to 100,000 tonnes/month over four months from February, while ensuring workers were paid, but progress to that end had been “limited”.

“Liberty promised everything, but has delivered on practically nothing,” it added.

The ministry said it had contributed around HUF 70bn (EUR 175.95) to saving the steelworks, including wage guarantees and the use of CO2 emissions quotas. It added that transitioning production at the base to green steel would require investment of a further HUF 200bn (EUR 502.72). Read details: Hungary’s largest steel producer gets Chinese support for green upgrade

The ministry said it was constantly communicating with Liberty on future plans and payroll. It added that Liberty had been instructed to ensure wages were paid.

In a separate announcement on Tuesday, ISD Power, the steelworks’ energy provider, said it had launched a liquidation procedure against Dunarolling Dunai Vasmű, owned by Liberty Steel Central Europe. ISD Power said Dunarolling had failed to pay its bills for about a year.

ISD Power is in the process of being wound up.

As we wrote earlier, Indian-owned steelworks Liberty Dunaújváros has paid over 3,000 employees their wages for August, on time, plus a one-off HUF 150,000 bonus, details HERE.

UPDATE

The government has pointed out to Liberty Steel that payment of the wages at the steelworks must take priority, and called on the company to ensure payment of the wages due without any delay, state secretary for economic strategy at the National Economy Ministry Mate Loga said at a press conference in Budapest on Tuesday. Loga confirmed that on Tuesday, liquidation proceedings were initiated against Liberty’s two subsidiaries due to insolvency.

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