Metinvest accuses Hungary of non-transparent sale of former Ukrainian oligarch's plant
Photo: press service of Metinvest

Ukrainian steel magnate Rinat Akhmetov's Metinvest group alleges that Hungary's tender for bankrupt metallurgic plant ISD Dunaferr was non-transparent and rigged in favor of British firm Liberty Steel from the start, the press service of Metinvest Group told in a comment.

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At the beginning of 2023, Metinvest informed the Hungarian government of its desire to buy Dunaferr, but the Ukrainian company was not admitted to the tender.

"We do not know the reason for the exclusion of other participants from the tender, but Metinvest was excluded due to the fact that the relevant ministry did not provide the liquidator with a conclusion that the group successfully passed the National Security Screening procedure," the comment reads.

The company does not know why Metinvest did not pass this procedure.

The group also said that in a transparent auction, the cost of the Dunaferr plant should have been around 200 million euros, but Hungary sold it for almost four times less – 55 million euros. Meanwhile, the buyer was reportedly the same company that had taken over management of the plant earlier in the winter without any public tenders being held.

"Taking into account these factors, it can be assumed that the tender was developed by the Hungarian government from the very beginning as a mechanism to legitimize the transfer of the plant at a non-market value to a specific buyer – Liberty Steel," Metinvest said.

The company believes that the anti-trust authorities of the European Union should pay attention to the actions of the Hungarian government during the competition for the plant.

The Ukrainian corporation ISD, once one of the largest steel producers in Eastern Europe, used to own the Dunaferr metalworking plant. The corporation also included the Alchevsk metalworking plant, over which control was lost since the end of 2017, the Dnipro metalworking plant, which in 2021 became the property of Metinvest and changed its name to Kametstal, and ISD Huta Czestochowa in Poland, which was sold to Liberty Steel as part of the bankruptcy process.

In July 2023, Hungary decided to sell ISD Dunaferr to British Liberty Steel for 55 million euros. The only bidders were Sanjeev Gupta's Liberty Steel and Vulcan Steel, linked to Indian businessman Naveen Jindal. Tender applications from other participants – Ukrainian Metinvest of Rinat Akhmetov, Swiss Trasteel Trading Holdind and Hungarian Trinec Property – were rejected for various reasons.