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Friday 22.09.2017 | Name days: Maigurs, Mārica, Māris
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Liepājas metalurgs to lay off workers

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Аuthor: Evija Trifanova/LETAWith the situation becoming more and more tense, Liepājas metalurgs (LM) plans to reduce the number of its workers by 8-10%. Workforce optimization proposals are currently being prepared for the company’s management. “April 10 is pay day at LM, and we are trying to allocate as much money as we possibly can in order to pay salaries on time”, – LM Chairman and largest shareholder Sergei Zakharin told Dienas Bizness newspaper.

The plant was working at full capacity this January; February and March – with nearly 60% output. April’s output is expected to be even lower, he said. “There has never been such a deep crisis in the steel producing industry”, – he claims. The situation continues to worsen, and the first signs of it getting better are not expected to come earlier than at the end of 2013.

The situation at the plant is becoming worse every day, Zakharin admits. He emphasizes that the state risks having a revolt not just in Liepaja, but in the industry as a whole with its indecisiveness on the matter of providing funding for LM. When asked whether shareholders are prepared to invest their own money in LM, something government representatives see as a necessary move, the businessman replied positively.

LM shareholders are holding negotiations with large Russian and Belarusian entrepreneurs. Zakharin previously noted that LM’s largest bargaining chip is Liepaja port’s LM – it provides the company with its own logistical centre at the port.

Swedbank‘s senior economist Lija Strasuna admitted in an interview to LTV that the closing of LM would be heavy blow for Latvia’s economy. She noted that the risks related to LM are not only of regional type – they affect the entirety of Latvia’s economy (LM makes approximately 6% of Latvia’s industrial turnover).

LM is the largest employer in Liepaja, with nearly 2 300 people in employment.

BNN previously reported that the government has not yet made a decision to get involved in the problems of LM. As stated by representatives, the government wishes for shareholders to play a larger role in problem solving. It is incredibly hard to come up with a positive solution to LM’s problems if its shareholders do not have a clear business plan, as well as the will to get involved in problem solving, Finance Minister Andris Vilks said. It was also reported that Ernst & Young recommends creating a restructuring plan for the enterprise, one that would include optimization measures for the increase of the company’s profitability.

Ref: 102.109.109.6956


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  1. Lars says:

    Unfortunately it is just the beginning of the end.

    Thumb up 0 Thumb down 0

  2. Anton says:

    All of workers will loose job before summer.

    Thumb up 0 Thumb down 0

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