2 Sep 2009 17:41

Mechel eyes third Estar steel plant

MOSCOW. Sept 2 (Interfax) - Mechel could assume the management of another member of the Estar steel group, this time the Guriyevsk Steel Works (GMZ), which specializes in steel milling balls, in the Kemerovo region, a source with knowledge of the situation told Interfax.

Earlier reports said Mechel could also manage Estar's Zlatoust Steel Works in the Chelyabinsk region and Rostov Electrometallurgical Plant in southern Russia .

Alexander Tolpach, Mechel's external communications manager, told Interfax that Mechel was not thinking of acquiring or managing the Guriyevsk plant but was looking at nothing more than cooperation under bilateral product supply contracts as with the Zlatoust and Rostov plants.

Estar was unwilling to comment on the information.

The Rostov, Zlatoust and Guriyevsk plants have been placed under court supervision. Mechel's Chelyabinsk Iron & Steel Works (CHMK) on August 7 signed a deal with the Zlatoust plant and the Chelyabinsk regional government under which CHMK and the Zlatoust plant will join forces to attract financial, human and material resources for the expansion of metallurgical production, and supply each other with feedstock, raw materials and other inputs.

Courts have also appointed supervisors at Estar's Novosibirsk and Nytva steel plants and Volgograd tube works.