September 07, 2008

Labor unions side with Mr Zhevago in battle for Kremikovtzi

Bulgarian news agency BTA reported that steel maker Vorskla Steel of Mr Konstantin Zhevago, one of the bidders for Bulgaria's biggest steel mill Kremikovtzi, has signed an agreement with the steelworks' labor unions on May 10th 2008.

The paper quoted the chairman of the Metalurzi Labor Union, part of the Podkrepa labour union bloc, Mr Lyudmil Pavlov as saying that the deal sees Vorskla Steel guarantee the funding that would Kremikovtzi operational, its workers paid and a chunk of the profit invested in the steel mill's modernization.

The agreement is the first time the labor unions picked a side in the race between two rival bidders looking to buy the 71% majority stake held by Indian businessman Mr ramod Mittal.

Mr Zhevago also has the support of the Metalitsi labor union, a member of Bulgaria's other influential labor bloc CITUB, investor.bg reported on the same day.

Ukrainian billionaire Mr Zhevago, who controls London listed iron ore mining producer Ferrexpo, is facing stiff competition from ArcelorMittal.