ECONOMY

Serbian copper firm to split

BELGRADE (Reuters) – Serbia’s copper smelting and refining firm intends to split into smaller units in an effort to attract the foreign investment needed to upgrade production that was battered by wars, international sanctions and mismanagement in the 1990s. The company Topionica i Rafinerija, itself part of the 18-firm Rudarsko-topionicarski Basen Bor copper complex in eastern Serbia, slashed by one half to around 100,000 tons its copper concentrate output target for this year due to poor supplies of raw materials. General Manager Dragisa Jovanovic said it would be difficult to find a single strategic partner for the entire firm, consisting of 10 units, which besides smelting and refining also has sulfuric acid plants. «There is no alternative but to divide the firm into independent entities to facilitate investment by potential foreign partners,» he told Reuters. Privatization prospects for each unit were being prepared as French and Italian firms had shown interest in some of them. Jovanovic said he preferred known copper producers rather than traders to invest in the company. «We need partners that are acquainted with the firm’s capabilities, have good access to world markets and want to fund our recovery.» He declined to comment on reports that Greece’s Mytilineos was negotiating a deal with the firm, but said, «We are having talks with various companies wanting to buy some of our units or just leasing capacities.» Veselin Mihajlovic, the company’s deputy general manager in charge of production, said that any future partner would have to invest some $20 million in the core business to raise production to full capacity of 23,000 tons of copper concentrate per month. «Many parts must be replaced, many repaired, the entire line has to be tested… and it takes time,» he said, but added he did not believe the plant could start operating at full capacity before the start of next year even with available funds. In January-May, the plant produced 48,000 tons of domestic origin concentrate and a negligible 1,500 tons of imported. «With such poor supply levels output could only reach 100,000 tons this year, well below what was originally planned,» Mihajlovic said. In the first five months of this year, the plant produced 4,573 tons of cathode copper, and 1,040 tons of it in May. Its plan for this year was 36,000 tons. To reach 2002 cathode copper output, the smelter would, besides domestic material, need to import up to 5,000 tons of concentrate with 20 percent copper each month, Mihajlovic said. The plant planned to produce 142,000 tons of domestic concentrate this year and to import around 68,000 tons. In 2002, it produced 214,000 tons of copper concentrate.