Huta Katowice steel mill to request 50% debt reduction

By the end of next week Huta Katowice (HK), a steel mill owned by Polish Steel Mills (PHS) will officially ask its creditors for 50% reduction in its debts. However its second biggest creditor, the Industrial Development Agency (ARP) - soon to become the dominant shareholder and to issue state guaranteed bonds to help with the mill's financial restructuring - finds such a solution unacceptable. "We cannot agree to the debt reduction," stated ARP president Arkadiusz Krezel, explaining that the State Treasury would suffer as a result of such a move. Meanwhile, HK's biggest creditor, Polish State Railways (PKP), is still considering HK's proposal. "We have yet to decided whether to accept this proposition," said PKP spokesperson Ewa Zagorska. HK's total debt amounts to zl. 2.5 billion including around zl. 1.5 billion owed to gas and coal suppliers. If the creditors accept the proposed deal, PHS could issue bonds worth zl. 1.6 billion that could be sold to an investor, potentially LNM Holding. (Puls Biznesu, pp. 1, 10; Prawo i Gospodarka, pp. 1, 4) A.D.