EC agrees to state aid for Huta Katowice privatization
The European Commission (EC) is ready to agree to Polish government help
for Huta Katowice (KH) in order to salvage the ailing steel mill. After
British-Dutch steel group Corus withdrew from privatization of HK, it
became clear that modernization of the plant is impossible without state
aid. EC officials claim that the mill needs at least euro 1 - 1.5 billion
in order to stay afloat and thus privatization is necessary. Yet it is
likewise apparent that no investor will make the move unless the Polish
government offers them support by taking over HK's $576 million debts and
covering the cost of social benefits for laid-off employees. Meanwhile,
Italian steel group Danieli said that it still intends to acquire a stake
in one of HK's divisions, despite Corus' withdrawal. (Rzeczpospolita,
p.B2)
