Competition Council OKs the acquisition of the production assets of COS Targoviste by Beltrame Group for €38.3 M + VAT

AFV Beltrame Group, one of Europe’s largest producers of steel bars and special steels, received authorisation from the Competition Council for the acquisition of the functional production assets of the Târgoviște Special Steel Plant in Targoviste.

The acquisition is part of a large investment plan in Târgoviște worth about half a billion Euro that includes the modernization of the existing steel plant and the building of the eco-intelligent plant for rebar and wire rod.

The value of the transaction amounts to EUR 38.3 million + VAT. In addition to the value of the acquisition, Beltrame Group will invest around €100 million in the next few years in modernising the equipment in the current plant. To this will be added the working capital and the construction of a new eco-intelligent plant for the production of rebar and wire rod, estimated at about 300 mil Euro. The completion of the transaction requires the fulfilment of additional conditions related to the insolvency procedure and the necessary approvals from the competent authorities. 

Present on the Romanian steel market since 2007, where it owns the rolling mill in Calarasi through its subsidiary Donalam, AFV Beltrame Group wants to expand its activity in Romania by acquiring and reopening the steel production unit owned by COS Târgoviște SA, a company currently under judicial reorganization, pending the resolution of the appeal against the Court’s decision to declare bankruptcy. The Beltrame Group aims to transform the COS Târgoviṣte plant into a European competitive special steel production unit. Thus, over the next 4 years, about €100 million will be invested in modernising the machinery, respectively the steelshop and the rolling mills as well as approximately 40-50 million euro in providing working capital. At the beginning about 450-500 jobs will be created, with the aim of increasing capacity to about 1,000 new jobs in the coming years. Currently, about 90 employees are working at COS Târgoviște to keep the utilities up and running and maintain the equipment.

“We are excited to expand our business in Romania with one of the most important steel plants and to revitalize the domestic production of both special steel and rebar, both of which are needed in many industries. We have included COS Târgoviște in our investment plans as it is a steel plant with a rich history and a lot of experience in the steel industry, and the products that can be produced here are complementary to the steel bars we already produce in Donalam Călărași. We will create a synergy with the rolling mill we own in Calarasi and the Târgoviṣte mill will return to the production of special steels for which it was originally built. We will start production in the existing steel mill and the two rolling mills as soon as possible. At first we will produce rebar, even if the plant cannot be competitive for this product, and later we will produce special steel, as the latter is more difficult to produce and requires more time to train the workforce. I am sure that in a couple of years we will have the same range of steels that we have now at Donalam“, said Carlo Beltrame, Group Business Development at AFV Beltrame.

In addition, in 2022, AFV Beltrame Group will start the construction of a new €300 million project in Târgoviște in an eco-friendly plant that will produce rebar and wire rod. The construction will take a maximum of 4 years, at the end of which the production capacity will be approx. 600 thousand tons/year. The plant will be in line with sustainability principles and will be equipped with innovative technology, which will ensure low energy consumption. The plant construction project also includes a photovoltaic park, which will power the new eco-smart factory. This will give the plant the world’s lowest emissions of greenhouse gases and particulate matter (dust), as well as the lowest water consumption (through treatment and recirculation) and the highest level of circular economy. Târgoviște will thus become a benchmark in terms of innovation and sustainability.

“In addition to the special steel, at the same time, we will build in Târgoviște the new plant for the production of rebar and wire rod, on which we have been working for 3 years and which will use the most modern and eco-friendly technology in the world. At the end of the investment, our target is to produce 1 mil tons of steel at COS Targoviste”, said Carlo Beltrame.

COS Targoviste was established in 1970, initially producing alloy and high-alloy steels for the civil and defence industry. Since 1975 it has been producing special steels used in the construction of the Cernavodă power plant. Since 1998 the company has been listed on the Bucharest Stock Exchange – stock symbol COS. In 2002 the majority shareholding was acquired by Conares Trading A.G. Switzerland, which later became Mechel International Holding GmbH and from 2013 the company is subject to insolvency proceedings. COS was the only full-cycle rebar producer in Romania (from raw material – scrap to rebar – finished product) and one of the leading producers of rebar and steel products.

The Beltrame Group owns the Donalam steel plant in Călărași, Romania, specialized in the production of hot-rolled steel quality bars for use in various industries, from oil and gas, automotive, large mechanical and hydraulic equipment to agricultural machinery and equipment. With more than 340 employees in Călărași, Donalam estimates a turnover of more than 630 million lei in 2021 and a sales volume of about 160,000 tons of steel bars.