Deripaska shows interest in RTB Bor

The sister-company of Russian Basic Element, SMR, has shown interest in buying copper mines and smelting complex RTB Bor.

Izvor: B92

Tuesday, 04.09.2007.

09:53

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The sister-company of Russian Basic Element, SMR, has shown interest in buying copper mines and smelting complex RTB Bor. It was announced that SMR will match the government’s first price of USD 340mn and buy the tender documentation. Deripaska shows interest in RTB Bor Russian billionaire Oleg Deripaska, president of Basic Element’s executive board, had a meeting with Prime Minister Vojislav Kostunica three months ago. SMR will compete to purchase RTB Bor property in the second such tender announced. In the first tender, SMR offered one dollar for the company, stating that "they knew that the tender would fall through". SMR Director Jeffrey Cauley said that whatever happens in this privatization, everything must be reviewed and checked. “We expect the process to be open and fair, and we do not have information suggesting that Kostunica offered anything to Deripaska." Even though Economy and Regional Development Minister Mladjan Dinkic maintains that the price of metal products will increase, Russian company officials believe that prices will drop by 30 percent in the next five years. Cauley said that the government was wrong to base the choice of a new buyer on price alone, and that it needed to take into consideration economic and social values in the development of Bor. He said that SMR would make an offer monetarily equal to the value of RTB Bor’s property, but that it would add other programs for investment and social development. “We will also have a program to encourage employees to start their own businesses,” Cauley said. The privatization agency announced the second tender for Bor on August 31, with a starting price of USD 340mn, plus a minimum investment of 180mn. Offers are expected from, among others, the Australian View Mining company from Perth, East Point owned by Zoran Drakulic, and a British consortium ORN, which finished second in the last tender. Romanian Cuprom won the first tender making an offer of USD 400mn, but later withdrew from the deal after it failed to secure financial guarantees.

Deripaska shows interest in RTB Bor

Russian billionaire Oleg Deripaska, president of Basic Element’s executive board, had a meeting with Prime Minister Vojislav Koštunica three months ago.

SMR will compete to purchase RTB Bor property in the second such tender announced. In the first tender, SMR offered one dollar for the company, stating that "they knew that the tender would fall through".

SMR Director Jeffrey Cauley said that whatever happens in this privatization, everything must be reviewed and checked.

“We expect the process to be open and fair, and we do not have information suggesting that Koštunica offered anything to Deripaska."

Even though Economy and Regional Development Minister Mlađan Dinkić maintains that the price of metal products will increase, Russian company officials believe that prices will drop by 30 percent in the next five years.

Cauley said that the government was wrong to base the choice of a new buyer on price alone, and that it needed to take into consideration economic and social values in the development of Bor.

He said that SMR would make an offer monetarily equal to the value of RTB Bor’s property, but that it would add other programs for investment and social development.

“We will also have a program to encourage employees to start their own businesses,” Cauley said.

The privatization agency announced the second tender for Bor on August 31, with a starting price of USD 340mn, plus a minimum investment of 180mn.

Offers are expected from, among others, the Australian View Mining company from Perth, East Point owned by Zoran Drakulić, and a British consortium ORN, which finished second in the last tender.

Romanian Cuprom won the first tender making an offer of USD 400mn, but later withdrew from the deal after it failed to secure financial guarantees.

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