Weglokoks to acquire fabricator subsidiary after debt agreement

Weglokoks has come to an agreement with PKO BP bank that will pave the way for the coal exporter to acquire the production assets of its stockist and fabricator subsidiary Huta Pokoj. The bank is one of Pokoj’s main creditors.

“This means the path has been opened to restructuring the unit, and also to saving jobs at the plant,” Weglokoks is quoted as saying by Polish media. Once the agreement is finalised, a part of Pokoj’s production assets’ debt will be paid and the way will be paved for future investments in the firm. Current production will not be affected, the coal exporter added.

Weglokoks’ spokesman did not respond before deadline to requests for confirmation.

Last week Pokoj’s unions carried out protests against the management’s handling of the firm. They wrote a letter to Polish Prime Minister Mateusz Morawiecki requesting him to partake in discussions with union representatives. They had previously called for his intervention last August (see Kallanish passim). Last week they again blamed government inaction for allowing imports of coal from Russia and steel from the East to damage domestic industry.

Last December unions secured an agreement with Weglokoks to maintain production and procure feedstock. Weglokoks was then supposed to buy out the remaining shareholders in the firm by end-February 2020; however, this did not happen. Huta Pokoj owes Weglokoks almost PLN 180 million ($42m) and a further PLN 52m to PKO BP. Pokoj and its workers previously reached an agreement with Weglokoks last September for internal restructuring and debt relief.