Ukraine criticizes Mittal over salaries at steel mill
Mittal bought the Kryvorizhstal mill for $4.8 bn in Ukraine's biggest and most profitable privatisation auction ever.india Updated: May 11, 2006 02:33 IST
Netherlands-based Mittal Steel Co on Wednesday rejected the Ukrainian government's complaint over salaries at the giant steel mill it purchased in the ex-Soviet republic last year, insisting it was fulfilling its ownership obligations.
The State Property Fund, which oversaw Mittal Steel's purchase of Kryvorizhstal from the state, warned last week that it might sue the company if did not fulfill what it called a promise to increase salaries within 30 days.
Mittal Steel countered in a statement that it has fulfilled almost all of its 60 obligations and accused the property fund of misinterpreting one of its obligations.
"To talk about breaking off the deal because of existing disagreements in interpreting one clause of the obligations ... is illogical and wrong," plant spokesman Frank Pannira said in a letter to Valentyna Semenyuk, the head of the State Property Fund, according to the statement.
Company officials refused to elaborate.
Neither the property agency nor the company's letter went into details. The mill's workers had always been considered some of the best paid in Ukraine.
Mittal Steel bought the Kryvorizhstal mill for 24.2 billion hryvna ($4.8 billion) in Ukraine's biggest and most profitable privatisation auction ever.
The sale fetched for Ukraine a price nearly six times higher than the amount it went for a year earlier, under former President Leonid Kuchma, in a sale that was later declared illegal.