Bosnia region annuls tender for Aluminij sell-off

SARAJEVO, June 1 (BestGrowthStock) – Bosnia’s regional government
annulled on Tuesday a tender for a majority stake in its sole
aluminium smelter as top bidder Glencore International AG
[GLEN.UL] set terms the cabinet was unwilling to fulfill.

“The government has decided to declare failed the tender for
the sale of an 88 percent stake in Aluminij Mostar,” the
Muslim-Croat federation cabinet said in a statement without
further elaboration.

The minimum price for the stake, equally owned by the
federation government and small shareholders, was set at 76.8
million euro ($93.30 million).

The Swiss-based commodities trader had set cheap power
supplies as a condition for the bid.

The government refused to provide cheap electricity prices
arguing Aluminij was a qualified buyer that can purchase power
under commercial prices. It however pledged to guarantee that
the company would get needed power quantities.

The sell-off talks have also been stalled over environmental
and ownership issues.

The government has been extending the deadline for Aluminij
Mostar privatisation since 2007 to give more time to the best
bidder to resolve outstanding issues.

The smelter produced 96,000 tonnes of primary aluminium in
2009, down from 123,000 tonnes in 2008, after cutting output by
a quarter last year but it gradually started returning to full
production last autumn.

Its revenues and exports fell by a third in 2009 to close to
138 million Bosnian marka ($86 million) and 260 million marka
respectively.

Stock Investing
($1=1.6 Bosnian marka)
(Reporting by Maja Zuvela; editing by Daria Sito-Sucic and
James Jukwey)

Bosnia region annuls tender for Aluminij sell-off