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Dec 27, 2007 14:20 EEST
BELGRADE (Serbia), December 27 (SeeNews) – Serbia invited on Thursday potential bidders in the sale of its car manufacturer Zastava to carry out due diligence in the company by end-March.
“The sale of the company is expected to start in April,” the government’s privatization agency said in a public invitation.
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The Serbian government owns 99.99% of Zastava.
Potential bidders will be able to access data rooms located in Zastava’s headquarters in Kragujevac, central Serbia, between January 14 and March 31, the agency added.
“The tender was called today but I expect the real market competition in April and May,” Economy Minister Mladjan Dinkic told reporters in Kragujevac. An unsuccessful bidder will be offered the opportunity to open a car factory in Serbia, he added without elaborating.
Dinkic said in September that at least five companies - GM, Fiat, Ford, Indian Tata and an unnamed Chinese company - had shown interest in buying Zastava.
The troubled car manufacturer, based in the town of Kragujevac, central Serbia, used to be part of the largest industrial conglomerate in Serbia during the communist era but is now struggling to survive. The state subsidies which it receives are insufficient for the company to upgrade its production facilities and introduce new models. Its outdated Yugo model barely sells outside Serbia despite its low price. Restructuring and privatisation have proved difficult as the company is one of the largest employers in Serbia.
Zastava has an installed capacity to manufacture some 60,000 vehicles a year. Last year its output was 15,000 cars.
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