Stomana II

completed

Steel mini-mill Stomana Industry A.D. (Stomana or the company), an existing IFC client, is the second largest steel producer in Bulgaria. The company plans to bring into operation a new hot rolling mill, to be located within its existing facilities. The project, expected to cost about Euro 43 million in capital investment, is going to be implemented over a one and a half to two-year period. It is not going to affect Stomana''s crude steel capacity as planned investment is in downstream operation. The installation of a new long products rolling mill in Stomana is an important strategic investment for Sidenor allowing it to: - rationalize its total production and take a full advantage of Stomana’s upstream capacity. - gradually replace low value added products with the higher added value long products; and - improve cost competitiveness due to:- reduction in overall transportation costs; - more efficient new equipment and processes of the new rolling mill; and - lower labor cost in Bulgaria than those in Greece.The project will be sponsored by Sidenor Steel Products Manufacturing S.A. ("Sidenor") a large Greek manufacturer and marketer of steel products, listed in the Athens Stock Exchange, who acquired Stomana in 2001. After Sidenor’s acquisition, Stomana was turned around and transformed into a sound and quite profitable enterprise. Sidenor is part of Viohalco, Greece, the largest metal processing group in the country, which also sponsored two other IFC projects.