The world's second-largest steel producer, LNM Holdings, bought a 51-percent stake in Bosnia's biggest steelworks, BH Steel, for 80 million dollars

The world's second-largest steel producer, LNM Holdings, bought a 51-percent stake in Bosnia's biggest steelworks, BH Steel, for 80 million dollars (65 million euros). Under the deal signed here by the LNM head, India-born Lakshmi Mittal, and Bosnia's Muslim-Croat entity's Prime Minister Ahmed Hadzipasic, the group is to invest at least another 135 million dollars over the next ten years in modernizing the work process. It is the biggest single investment in Bosnia following the 1992-95 war that ruined the Balkans country's communist-style economy. LNM Holdings was selected in June for negotiations on the purchase, after the owners rejected another bid submitted by ISPAT Group of India. LNM is obliged to activate integral production of the steelworks until the 2007 raising it from the current 150,000 tonnes of steel per year to between two and 2.5 million tonnes. The group is to keep all 2,850 BH Steel workers, and plans to increase the number of employees to 4,000 or 4,500 over the next few years. BH Steel was set up in 1999 as a joint venture owned by the government of Bosnia's Muslim-Croat part and The Kuwaiti Investment Agency (KIA). KIA, which has invested 95 million dollars (75 million euros) in BH Steel, is to keep 41-percent stake in the company, while the remaining eight percent will remain in the hands of the goverment. The steelworks, located in the central town of Zenica, was the main producer in the former Yugoslavia, but it was devastated during the country's war.