July 1 (SeeNews) - British-Swiss company Glencore has allegedly proposed to take over aluminium firm Aluminij if Bosnia's Federation government commits to a fixed electricity price of 50 euro ($56) per megawatt hour for the ailing company by the end of the year and finding a long-term solution to the power supply issue, local media reported.
Aluminij's director general Drazen Pandza has informed the Federation government about Glencore's new offer, news daily Vecernji List reported on Wednesday, quoting unnamed sources.
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Pandza has also told the government that power supplies to Aluminij will halt at midnight on Friday and the company would be forced to start shutting down its operations in the first minutes of Saturday. He also warned that such uncontrolled shutdown could hold risks for the environment and people's health.
Pandza, together with Aluminij's management, is reportedly expected to resign this week in a protest against the unwillingness of the Federation government, Aluminij's single largest shareholder, to step in and save the company.
At the same time, the Federation government reiterated on Thursday that it cannot subsidise Aluminij's power price any longer after tolerating in 2015-2018 an increase of 30 million marka ($17.3 million/15.3 million euro) annually in its unpaid bills to state-controlled power utility Elektroprivreda HZHB.
To date, Aluminij's unpaid bills to Elektroprivreda HZHB have reached some 280 million marka, according to earlier media reports, which is why the power utility firm is cutting its supplies to the troubled aluminium smelter.
"In the past period the Federation government in cooperation with Aluminij's management has had several talks with interested investors. However, the electricity price remains a hot issue for Aluminij and the potential investors are aware of this," the government said in a statement after its weekly meeting.
"The price of electricity is formed on the electricity market and the Federation government has no mechanisms to influence it in any way," the statement added.
Also on Thursday, around a hundred of Aluminij's 900 workers held protests in front of the government building in Sarajevo, news wire Klix.ba reported. Their representatives met the Federation prime minister Fadil Novalic and energy minister Nermin Dzindic.
The head of the workers' trade union, Romeo Bioksic, was quoted as saying that the government will hold talks on Aluminij with potential investors from Dubai later on Thursday and will again meet the Glencore representatives on Friday.
"It is not important for us who will be the owner, it is important to keep the jobs," Bioksic said.
The Federation government controls 44% of Aluminij, followed by the Croatian government with 12%, while the remainder belongs to smaller shareholders.
Aluminij is based in Mostar, in the Federation, which together with the Serb Republic make up Bosnia and Herzegovina.
(1 euro = 1.95583 marka)