Potential buyers of Bulgaria's biggest steelworks Kremikovtzi have suspended talks with the Cabinet and holders of Kremikovtzi bonds for the duration of the gas crisis, Dnevnik daily reported on January 14, quoting two bondholders and Deputy Economy Minister Nina Radeva.

Brazil's CSN and Russia's Smart Group are the two bidders that have shown the most interest in Kremikovtzi despite the global economic downturn, engaging in talks with bondholders and the Cabinet in recent months, according to Dnevnik.

But over the past week, those talks were put on hold as the prospective bidders await the outcome of the gas dispute between Russia and Ukraine, which has left Bulgaria without any supplies of natural gas, a raw material that Kremikovtzi uses in abundance.

The quickest path towards the resolution of the steel mill's future is for the Cabinet and bondholders to reach an agreement with one of the prospective bidders, which would smoothen the ownership transition, but there has been no agreement made just yet, Dnevnik said.

The alternative is for the steelworks and its assets to be sold piecemeal, which the world's biggest steel maker ArcelorMittal was still interested in, the daily reported. To keep tabs on proceedings, the Luxembourg-based company bought a small share of Kremikovtzi's loans, which will allow it to keep an eye on insolvency procedures.

That is still some way off, however, Dnevnik said, as the insolvency court would need at least until end-February to sort through the creditors' claims, which means that the next meeting was unlikely before March at the earliest.