Judgment time for LARCO – Concession tenders on 14 March

Two of LARCO‘s biggest investment barriers remain unresolved just 24 hours before the closing date for the submission of binding bids.

According to information from the Local Government, the Special Administrator and the Hellenic Republic Asset Development Fund have invited the potential investors on Monday, March 14, to submit the binding offers in the respective tenders for the concession of the assets and the factory of the long-suffering iron-nickel industry.

However, according to competent sources, although the LARCO case is coming to an end, the two important thorns of the industry remain open at the last minute before the tenders.

Mass redundancies

The first has to do with labor and the second with environmental issues.

With regard to employment, sources want the process of collective redundancies of 1,065 employees not to be completed yet as the first stage to be followed in these cases, the consultation between their representatives and the employer (in this case the Special Administrator) has not been closed, with the necessary agreement. The two sides are therefore invited to present their positions to the Supreme Labor Council (SLC). Sources want a meeting between the institution and the workers’ unions to be arranged for today. It remains unknown when the Special Administrator will be invited, while it should be noted that if the SLC finally succeeds in completing the process, it will give its opinion in 10 days and in 20 days the dismissals will be implemented.

The environmental issues

Regarding the second thorn in the side of LARCO, the environmental information, they state that the necessary guarantees requested by the prospective investors and especially regarding the violations of the past in which the owner was the Greek state have not been given. The issuance of the Decision of Approval of Environmental Terms is pending, as it is said.

With these two serious obstacles as well as the estimates of well-informed sources who want that by putting the key in the door… of the factory the new investor will require funds of at least half a billion euros, the LARCO concession project hangs on a thread…

The probability of failure

In the event that the tender process fails… then the LARCO file is closed in a dramatic way: The company goes bankrupt and its assets go under the auctioneer’s gavel… with the employees losing their jobs.

LARCO is in a special management status since 2020, while as mentioned above, two competitions will be held next Monday. The first will be by the Special Administrator and concerns the transfer of the mines of Evia, Fthiotida, Viotia (Agios Ioannis area) and Kastoria, stocks of ores, by-products and recyclable materials as well as agricultural parcels. The second tender is organized by the HRADF and concerns the long-term lease of the LARCO factory and the mines in Larymna and Loutsi. These are facilities and mining rights that belong to the state.

The finalists of the tender process are three investment schemes GEK TERNA – AD HOLDINGS AG, MYTILINEOS and COMMODITY & MINING INSIGHT IRELAND LIMITED.