EU declares state aid to PHS must be cut by 50%

The state aid that Polish Steel Mills (PHS), receives, and to which the European Commission agreed, will be lowered by zł. 1.7 billion to zł. 1.2 billion. "In the business plan accepted by the Commission, it was accepted that first state-owned companies will exchange their receivables for shares in PHS and its privatization will be carried out later. Now, EU experts decided that such conversion should be counted as state aid," explained PHS president Jerzy Podsiadło. However, the concern's liabilities will be taken by the foreign investor and amount to zł. 1.7 billion. International steel concern LNM, which has PHS privatization negotiations exclusivity rights until August 22, has accepted to take over the liabilities, press on with PHS' business plan and its investment projects. "LNM has a great deal of experience in restructuring steel companies across the world," assured Podsiadło. (Puls Biznesu, pp. 1, 7) M.M.