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UPDATE 1-Voestalpine puts 5 bln euros steelworks on ice

Published 12/18/2008, 09:06 AM
Updated 12/18/2008, 09:10 AM

* Decision due to global economic slowdown

* Major steelworks was planned on the Black Sea

(Adds detail, background)

VIENNA, Dec 18 (Reuters) - Austrian steelmaker Voestalpine has put on ice a plan to build a 5 billion euro ($7.2 billion) steelworks on the Black Sea due to the global economic slowdown, the company said on Thursday.

The factory with a planned output of 5 million tonnes of high-quality steel per year had been under consideration since last year and Voestalpine had already screened possible locations in Romania, Bulgaria, Turkey and Ukraine.

"The decision has now been postponed indefinitely due to the global economic slowdown and the recessive development to be anticipated in Europe," the company said in a statement.

It said the possible locations would be reconsidered if the project was reactivated in the future.

Voestalpine Chief Executive Wolfgang Eder said earlier this week earnings in its 2009/2010 business year would be significantly lower than in the current business year, when it expects 1.4 billion euros in operating earnings before one-offs. (Reporting by Boris Groendahl; Editing by David Holmes)

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