The two investment schemes have finally submitted mandatory financial proposals for LARCO’s over-indebted assets in two parallel tenders, special management and TAIPED. However, one of the two companies, namely Commodity & Mining Insight Ireland, which is also said to be linked to investment funds from the Persian Gulf, was involved in only one tender for quarry concession rights throughout Greece. Instead, the joint venture between GEK TERNA and AD Holdings AG submitted a binding offer for both parties. That is, for the lease of the LARCO plant from TAIPED (along with the lease of the Larimna mine and the Lucio mine), as well as for the rest of the company’s mines throughout Greece in the corresponding special administrator tender.

However, the tenders are structured in such a way as to give investors the opportunity to take both assets. Thus, in the coming week, the printout of legalization documents and technical proposals of two candidates for both tenders is expected, and in a few days – their binding financial proposals. If GEK TERNA’s joint venture with AD Holdings AG does not already have the highest financial bid for mines, it will be allowed to advance to the second round with another bidder. The process is technically also known as a shootout.

From the GEK TERNA investment scheme with AD Holdings AG and Commodity & Mining Insight Ireland.

The new owner will have five years to modernize and bring LARCO into line with environmental regulations, with market sources estimating the investment needed to modernize the iron and steel production at more than 200-300 million euros.

Recall that LARCO got into a special management procedure because of its debts and government subsidies. Therefore, a special administrator appointed shortly before the start of the pandemic found the company with a negative net worth, which at the end of 2019 exceeded 407 million euros. The arrears exceeded 500 million euros (of which 350 million are at checkpoints), and in early 2020, Greece was convicted by the European Court of Justice for non-enforcement of decisions on illegal state aid LARCO in the amount of 170 million euros.

As a result, she was fined 4.4 million for six months (since 2017) and 5.5 million at a time, while every six months of LARCO’s work means charging 22.5 million or 123,000 euros per day, as the business “burns out” about 3 million per month (data as of April 2022). These amounts should include 52 million, which the state has given so far to the special administration for the continuation of the work of the plant. As well as the fact that the state paid compensation to workers and another 20 million, corresponding to debts to EFKA during the period of special administration.