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Steel Group Owners Happy with Business in Slovenia

Ljubljana, 28 December (STA) - Dillon, the Russian owner of the Slovenian steel industry group SIJ, is happy with the business in Slovenia, SIJ chief supervisor Andrey Zubitskiy told the daily Delo on Friday. Although somewhat better results were expected, he does not attribute this to bad operating of Slovenian companies but to the general economic situation.

The Slovenia-based subsidiary of the Russian group KOKS bought a 55% stake in SIJ from the state for EUR 105m in 2007, but is currently not considering a purchase of the state's remaining 25% plus one share, Zubitskiy said.

He noted that Dilon has had no major trouble "inside or outside the company, or with the government", and that they had no interest to move production to Russia.

KOKS makes raw materials for steel in Russia, he said, explaining that making steel in Russia would be too expensive, while the producers there also lack the know-how for special kinds of steel.

Commenting on this year's results, SIJ chairman Tibor Šimonka told the daily that the first half of 2012 was relatively good, but the situation deteriorated in the second half, mainly due to the difficult conditions on the western European market, where the group exports 70% of its products.

The demand and prices fell, and energy and financing costs increased, he added.

In 2013 SIJ aims at much better results with a 10% growth in revenues, Šimonka said, noting that no layoffs are planned and the number of employees might only decrease gradually through attrition.

Zubitskiy also spoke about the interest of Russian investors in the Slovenian market, stressing that Slovenia is a small country, where the biggest bank is a few times smaller than a medium-sized Russian bank.

There is not much interest for Slovenian banks among Russian investors, but interest can be expected for companies like energy group Petrol or aluminium producer Talum and in tourism, he explained.

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