January 22, 2021
30 million euros invested in Newco Ferronikeli, but Kosovo’s government aid is needed to save the industry

Vice President of the BALFIN Group for Business Mergers and Acquisitions, Steven Grunerud, gave an interview last month to the specialized economic magazine Monitor, where he raised concerns about the economic consequences that threatened the mining industry in Kosovo and especially Newco Ferronikeli company that is owned by Balfin Group.

Due to the price crisis in world markets, as well as the consequences of Covid-19, which made the situation even more difficult, the mining industry in Kosovo is facing great challenges and is today at an important crossroad. Balfin is implementing a serious investment plan in the Drenas factory worth 30 million euros and these investments have not stopped, but have continued with the same intensity, despite the pandemic and the economic problems caused by it. But it seems that a determined and clear intervention of the government in Kosovo would be needed, in order for this industry not only to be saved, but to create the conditions for it to flourish in the coming years, thanks to the investments that Balfin Group has made and that promise increased production and employment.

Mr. Steven Grunerud interview

  • What has been so far the overall performance of BALFIN Group’s investment in Kosovo, Newco Ferronikeli?
  • We have implemented a € 30 mln investment program that will extend the life of the plant and improve efficiencies in the processes. We are currently 70% of the way through the plan and should complete by the end of next year. The past performance has been difficult and below expectations in 2018 and 2019, but we have seen improvement in in 2020 given our investment program and improved management focus. We expect 2021 to be improved over previous years.  We feel that Newco Ferronikelli this is a long term investment and it will take time to see results.
  • In the last years, the company has resulted in losses. Why these results?
  • The nickel market has been difficult and the production in the plant has been affected by the older equipment. Do not forget that the plant has been shut down twice in 2018 and 2017 due to market prices. While we examined this option during 2019, we decided to keep operating and try and improve the processes. We believe that we have improved some of them and will continue to upgrade and improve the process in order to have the plant last another 25 years.
  • How would you assess the climate of doing business in Kosovo and what difficulties (problems) can you identify? If see any from the perspective of an international investor.
  • To be honest it has been quite difficult. Ferronikelli is the largest exporter in the country and a major employer with over 1000 direct and likely 2000 indirect employees. We are the largest consumer of energy in the country. As stated when the market was difficult we could have closed for 6 months, but we chose to keep operating and pay salaries on time. We are not sure that can be said for other mining and smelting operations in the country. The elections in 2019 and the difficulty in forming governments made it very difficult to find counterparties to discuss issues. Kosovo has very little large industries, and we feel that there is a lack of understating within the government on these issues. We are trying to engage with the government in order to ensure that Ferronikeli has the same regulatory regime that other European companies that operate in the same field. This ensures that Ferronikeli stays competitive and keeps the thousands of employees working.
  • How is the actual situation with the international market and at what scale the market was affected by COVID-19 pandemic?
  • – The market was badly affected by COVID, as were all industries and businesses. All businesses were very careful about future plans and purchasing in case the pandemic and the economic situation became even more worse. With the possible vaccine being issued, we are seeing some green shoots of improving economic conditions and we hope that this continues for 2021. Nevertheless Ferronikeli is still focused on improving the efficiency of its operations.
  • What are your business expectations and objectives for the coming year (2021)?
  • Our expectations are that we hope that the economic situation improves, the next level of investment would be to substantially increase production at the plant and therefore hire additional employees and staff. However to do this we will certainly require some additional support from the government and regulatory agencies.


Balfin Group is not only present in the authorized retail resale sector of household appliances in Kosovo with the companies Neptun and Jumbo, as for several years it manages one of the largest companies in the country, Newco Ferronikelin, which is undoubtedly the largest exporting company in the country, as well as one of the largest employers. This industry is also associated with 2 thousand indirect jobs, in addition to about 1,000 employees of the factory itself.

In December 2020, the Balfin Group launched another important project in Kosovo.

In fact, a new Logistics Center on the outskirts of Prishtina opened its doors, an investment worth 5 million euros, where an area of about 15 thousand square meters, will serve as the new logistics center of the companies Jumbo, Neptun, and Elektroservis, as well as to the offices of the latter two.