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-   Aid : NN 75/93
-   Sector : Aluminium, INESPAL
-   Spain

The Commission today decided in principle, subject to final decision that
the injection of Ptas 34,200 million (ECU 258 million) which the Spanish
Government made in February 1992 to Inespal Group, the State owned
aluminium producer, did not constitute State aid falling under of Article
92(1) of the EEC Treaty.

The capital injection was decided in 1990 in order to finance investments
which were approved in the same year by the Instituto Nacional de Industria
(INI), the State owned holding group and majority shareholder of Inespal.
The investments were considered indispensable at that time to give Inespal
the opportunity to take advantage in the years 1990/1994 of the growth and
favourable market conditions which were at the time forecasted for the
aluminium transformation sector, on which the investment plan was focussed.

The purpose of the plan was to achieve an increase of the downstream
production so as to correct  the imbalance existing between the primary
aluminium production and transformation. The plan covered the sectors of
rolling, foil, remelting, industrial extrusion and converted foil.

The Commission drew the conclusion that, State aid was not involved in the
capital  injection to Inespal Group. Given the prosperous financial
situation of the Group and the favourable outlook of the aluminium market
at the time, supported by serious studies of all market segments, the
Commission considered that a private investor, acting under commercial
considerations in relevant circumstances, would have not acted differently
from the Spanish Government.

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