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SARAJEVO (Bosnia and Herzegovina), June 17 (SeeNews) - The government of Bosnia's Federation urged the management of troubled smelter Aluminij to start looking for a strategic partner from the aluminium sector as the first step towards finding a long-term solution to its financial woes, local media reported on Monday.
The Federation's energy minister Nermin Dzindic and finance minister Jelka Milicevic held talks with representatives of Aluminij in Sarajevo, as the aluminium smelter is under threat of halt of power supplies due to unpaid debts, news portal Klix.ba reported.
Klix.ba quoted Dzindic as telling reporters after the meeting that the Federation's government and energy ministry will invite in the next 10 days representatives of all Aluminij shareholders for talks in order to seek a long-term solution for Aluminij.
Dzindic stressed that the government of the Federation does not have the means to make final decisions regarding the future of Aluminij since it controls only 44% of the company. The Croatian government is next with 12%, followed by owners of smaller stakes.
Dzindic also said that several conclusions have been made at the meeting with Aluminij representatives which will be presented to the remaining shareholders in the coming days. Under the conclusions, Aluminij's management should, as a first step, launch actions towards finding a strategic partner.
Only after this option is exhausted, the management should start preparing for the opening of liquidation proceedings with a gradual decrease of production, Dzindic said, according to the media report.
In addition, Aluminij should hold talks this week with the representatives of Bosnian power utilities Elektroprivreda BiH and Elektroprivreda HZHB in order to seek solutions for power supplies to the smelter.
Klix.ba quoted the head of Aluminij, Drazen Pandza, as saying that the company is in financial crisis and it is not possible for Aluminij to continue to operate in the current state.
Elektroprivreda HZHB has cut electricity supplies to Mostar-based Aluminij as of June 16. The smelter has reportedly managed to agree power supplies for two weeks with an alternative supplier.
Aluminij has been in financial trouble in the past ten years due to costly electricity bills, among other reasons.
The aluminium smelter is based in the Federation, one of the two autonomous entities that form Bosnia. The other is the Serb Republic.