Bosnia metals sector sees boost from Aluminij sale
SARAJEVO (Reuters) – The sale of Bosnian aluminium plant Aluminij to a foreign buyer would boost the country’s powerhouse metals sector, doubling the firm’s output and having a trickle-down effect to small producers, analysts said. The international tender, published last week and running until April 23, sets a minimum price of -76.84 million ($100.8 million) for an 88 percent stake in Aluminij, the country’s biggest exporter. The Muslim-Croat Federation, which has shared Bosnia with the Serb Republic since the end of 1992-95 war, hopes to attract top producers such as Alcoa, Alcan Inc and RUSAL. Aluminij’s longtime partners, Norsk Hydro and Swiss-based metals trader Glencore, are also desirable buyers. Analysts say the sell-off would fuel the expansion of the company, which last year recorded output of 120,000 tons and has begun preparations for the construction of a new plant with a capacity of a further 130,000 tons. «The privatization, especially to a firm with international reputation in the field, will bring about new investment that should double Aluminij’s output,» said Midhat Cehajic of Bosnia’s Foreign Trade Chamber. Reinforcing confidence The sale would also reinforce confidence in the metals sector, a traditional driving force of the Bosnian economy accounting for 16 percent of gross domestic product (GDP) and for 52.5 percent of the country’s total exports in 2006. Early 2007 figures show the trend is on the rise, with the key players being Aluminij and Mittal Steel Zenica, a unit of world No 1 steelmaker Arcelor Mittal, as well as the Birac Zvornik alumina refinery and a dozen other midsized metal processors and car parts producers. Birac Zvornik, majority-owned by the Lithuanian Ukio Bank Investment Group, has also announced plans to start building a -300 million aluminium plant this year. Business analyst Eldar Dizdarevic said that another important result of Aluminij’s privatization would be the reintegration of the energy sector in the federation, where two separate Muslim and Croat-run power companies now operate. «The government will have to secure electricity supplies to Aluminij’s new owner, which means that the two power firms will have to cooperate more closely and may even unify eventually,» he said.
