The aluminium producer Alro Slatina is preparing to contract a syndicated loan worth $105 million from foreign markets. The German bank HVB and the US Citibank will be the leaders of the banking syndicate, according to market sources.
The loan will most likely be contracted in September. Part of the money will be used to expand Alro’s production capacity amid favourable conditions on the international aluminium market.
Should negotiations on financing be finalised, this will be one of the most important loans contracted by a Romanian private company from the international market in the last few years.
Representatives of Alro and of banks leading the lending syndicate were unwilling to comment on information regarding financing.
This year, the largest syndicated loan contracted by a Romanian company from international markets stood at $200 million, obtained by Banca Comerciala Romana (Romanian Commercial Bank-BCR).
Over the last two years, owing to the increase in aluminium prices on international markets, Alro has been continuously raising its production capacity, from 180,000 tonnes/year in 2002 to 230,000 tonnes/year, estimated for 2004.
The company’s majority shareholder, US trading house Marco International, is however planning to speed up the pace of these increases in capacity, first towards 300,000 tonnes/year and then up to 400,000 tonnes/year.
Moreover, there are also investment plans for Alprom Slatina, a company in which Alro holds a majority stake. Alprom processes part of the aluminium produced by Alro and investments will be used to increase those processing capacities linked to output that targets the constructions industry.
At the same time, the Alro-Alprom group plans to launch a project in the energy field, a very important component of the total costs related to aluminium production. The money needed for the investments linked to this project could be attracted through another international financing project, according to market sources.
Plans to expand Alro-Alprom have been boosted by developments on the international aluminium market over the last year. This metal’s quotation on the bourse in London rose from about $1,500/tonne to about $1,800/tonne.
When Marco bought Alro in 2002, the quotation for aluminium stood at about $1,350/tonne.
Following these increases in price and production capacity, Alro’s financial results have also registered significant growth this year. The company reported turnover standing at $208 million for the first six months of this year, 45% higher as compared to the corresponding period of last year, while net profit stood at $30 million, an increase of around 33%.
laurentiu.ispir@zf.ro