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Government plan to buy Dunaferr back in play

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Hungary’s government has not scrapped a plan to buy troubled steelmaker ISD Dunaferr, Hungarian Energy Regulatory Authority (MEKH) president Lajos Dorkota informed at a press conference in Dunaújváros yesterday.

Negotiations are continuing between the state of Hungary and ISD Dunaferr owner, Russian state-owned Vnesheconombank, according to Dorkota, and managers from the bank will come to Hungary early in February.

Dorkota conceded that ISD Dunaferr management has firmly excluded the possibility of the company’s sale to this point, but said the owner could yet decide otherwise. Dorkota noted that the situation with the Dunaújváros-based company was on the agenda during talks between Prime Minister Viktor Orbán and Russian President Vladimir Putin earlier this week.

In August, Dunaferr announced plans to lay off some 1,500 employees – representing 20% of its workforce – that would certainly wreak havoc with the local economy. National Economy Minister Mihály Varga shortly thereafter got to work on government proposals to buy out the owners.

By November, however, chief negotiator/state secretary for employment Sándor Czomba was forced to admit the central government’s scrapping of its acquisition plans.

As for the layoffs, these were first postponed and then reduced to 400, rather than the 1,500 originally planned. Said layoffs began in November.

 

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