COS Targoviste signs $20.5m deal

Combinatul de Oteluri Speciale (Special Steel Plant – COS) Targoviste and Mechel Trading signed two steel product delivery contracts worth $20.5 million. Mechel Trading, which opened a commercial representative office in Bucharest, is a branch of Russian-based Conares Group, the owner of the plant. The contracts will run throughout this year. The majority shareholder will also supply part of the raw material used by the plant, with this year’s quota amounting to $10 million. The company management says “the increase in the plant’s exports and the access of the steels made in Targoviste to the exclusive markets of the world” are part of the majority shareholder’s strategy to turn COS around. The Russian investors hold several steel and iron plants in Romania and the acquisition of those mills resulted in an expansion of the markets and in better sales figures. The plant’s sales in the first nine months of last year totalled $95 million, the same as in the entire 2002. Although sales went up, the plant continued to operate at a loss in the first nine months of last year when it posted 295bn ROL ($9 million) losses. The preliminary 2003 financials are due out on February 13. ZF