Montenegrin company buys bankrupt aluminium plant

PODGORICA, June 10 (Reuters) - A private Montenegrin firm agreed on Tuesday to buy the country's bankrupt aluminium plant KAP for 28.5 million euros ($38.80 million), but said it would fire more than a half of the workforce.

The European Union candidate country spent millions of euros a year keeping Kombinat Aluminijuma Podgorica afloat, until a court launched bankruptcy proceedings for the smelter last year.

KAP is Montenegro's single biggest industrial employer and is jointly owned by the state and Russian billionaire Oleg Deripaska's Central European Aluminium Co.

KAP's 380 million euros of debt amounts to some 10 percent of the Adriatic republic's economic output and its biggest creditor is the state, to which it owes 148 million euros.

"We will take over KAP as of July 1 and we will keep 300 workers," said Vesein Pejovic, the owner of Uniprom, which agreed to buy KAP. He said the government would finance welfare programmes for some 420 workers who will lose their jobs.

In 2012, KAP accounted for 30 percent of Montenegro's exports but the business and about 1,000 jobs at the time only survived thanks to hefty state subsidies and loans that it could not pay back.

With Montenegro seeking EU membership, where direct subsidies are not allowed, the government is trying to cut off financial aid to loss-making companies.

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