The company's previously announced optimization plan is at risk of being disrupted
The restructuring administration has revealed that Czech steelmaker Liberty Ostrava, a subsidiary of British Liberty Steel, is bankrupt. As a result, the company's previously announced restructuring plan is at risk of failure. This is reported by AçoOrbis with reference to local media.
The restructuring administration has submitted to the regional court a proposal to lift the general moratorium on the repayment of the company's debt, and this proposal will be considered on February 28, 2024.
The company, in turn, claims that it is solvent and continues to comply with the obligations arising from the general moratorium. The restructuring plan allows the company to resume operations and pay its obligations to all creditors, including energy supplier Tameh Czech, the Liberty Ostrava spokesperson added.
However, the energy supplier refused to consider changing the electricity supply contract, which provides for the supply of electricity at normal market prices.
As previously reported by Compraço, Tameh has suspended power supply to Liberty Ostrava since December 21, 2023, which has completely halted the plant's production. The sole energy supplier stopped operations due to non-payment of bills by LIBERTY.
LIBERTY Ostrava, in turn, promised to resolve issues with creditors and bring them into line with market conditions. In particular, the company published a production optimization plan, which called for the launch of blast furnace No. 3 in January. Furthermore, the company will focus on producing the most demanded products and importing some raw materials.
Currently, the factory remains idle and the timing of restart remains uncertain.
FREEDOM Ostrava is an integrated steel plant with an annual production capacity of around 3.6 million tons. The company primarily serves the construction, engineering, and oil and gas industries. The company is a leader in the production of road barriers and pipes on the Czech market. In addition to the domestic market, it supplies its products to more than 40 countries around the world.
