Invest Nikarom, the new owners of the Mechel Targoviste steel factory in Romania, will lay off around a quarter of its 2,000 employees and will restart production at the factory by the end of March. The laid off employees will have 20-day's notice and a compensation package consisting of three gross monthly salaries.

The factory is currently under insolvency and trying to reorganize. It ended 2012 with revenues of some EUR 211 million, a drop of 12 percent on 2011, but posted smaller losses, some EUR 23.3 million, down around a quarter on the year before.

Mechel Targoviste was part of the Mechel group, but was sold in February, together with Mechel's other factories in Romania in a deal with the symbolic value of some USD 70.

The 2,000 employees of the Targoviste factory have been in technical unemployment since December last year, with only 75 percent of their salaries covered by the employer, according to the law. Work has already re-started at two of the sections, with the third scheduled to return to production on March 23.

The new owners of the factory recently faced protests from the employees which had been previously laid off and who had not received their compensation packages in full. The buyer is controlled by Victor Chumakov and Svet­lana Chu­makova, both of Russian nationality. The two are reportedly the parents of Olga Chu­makova, the head of Mechel's office in Romania, who said in autumn last year that the factories will not be closed down.

editor@romania-insider.com