Ukrainian scrap group acquires Latvia's leading rebar maker

MOSCOW (Scrap Monster): The Ukranian scrap company, KVV Group has acquired Liepajas metalurgs (LM)- the Latvian rebar manufacturer. The deal value is pegged at €107m. LM had stopped production at the facility in May last year and had put up the mill for sale during early this year.

According to reports, the LM facility consists of an electric arc furnace installed by Italian STG Group. It was one of the most modern meltshops in the entire European region. However, the operations at the mill were badly affected by lack of working capital.

The mill requires over 1 million tonnes of scrap per year to operate. The Baltic States can meet almost 80%-90% of the total requirement. In addition, proximity to other scrap exporting countries is likely to cut the freight costs drastically. Another feature of the mill is its captive deepwater port, which does not freeze despite being so far north on the Baltic Sea.

The rebars produced by LM are mainly exported. The exports constitute nearly 98% of the total output by the company.

KVV owns and operates a chain of scrap yards across Ukraine. Though the firm has 12 plants, only 3 of them are currently operating on account of current crisis situation.