M.T. Abraham To Pitch 15-Year Lease Agreement To Aluminij Mostar

M.T. Abraham To Pitch 15-Year Lease Agreement To Aluminij Mostar

Talks over the fate of Bosnian aluminium smelter Aluminij d.d. Mostar continue this week between the government and a Sino-Israeli consortium, but the recently laid-off workforce at the plant is reportedly not optimistic that such talks will yield a positive outcome.

Aluminij management will continue to meet with representatives from the consortium, which is headed up by Israeli firm M.T. Abraham. The consortium pitched an offer earlier this month that would prolong the plant’s life if the government agreed to subsidize electricity and work with the plant on modifying debt arrangements, but the proposal was ultimately nixed by Aluminij.

Union representative Emil Coric was quoted in domestic media as saying that Federal Energy Minister Nermin Dzindic announced a new round of negotiations between Aluminij and M.T. Abraham, but he said the 362-strong workforce does not have high hopes that the new talks will lead to a new outcome.

“We don’t know what will happen to us and Aluminum. We signed the cancellation decisions and left. We will ask the Government about everything when the time comes. I do not know when the negotiations might follow.”

According to the report, the latest plan involves leasing Aluminij’s facilities to M.T. Abraham as it infuses the operation with the needed capital to continue as a going concern.

The plan is rumored to be slated for consideration at Aluminij’s next corporate meeting later this month, with representatives from the governments of Bosnia and Croatia in attendance.

Abraham Group Director Isaac Mansur Tamir went on record last week to elaborate upon the proposed lease arrangement, saying that the lease will likely be for a term of 15 years, with an option to extend for another 15 years.

Currently the autonomous Bosniak-Croat Federation is the plant’s single biggest owner, having a 44-percent stake in it. The Croation government holds another 12 percent, with smaller individual shareholders owning the remaining 44 percent.