Two Indian market leaders bid for Europe’s biggest steel manufacturing plant

MASSIMO PERCOSSI

Workers of the ILVA steel plant demonstrate in front of Deputy Chambers in Rome, Italy, 29 November 2012 while the Italian government and social partners are trying to reach an agreement about the future of the Taranto factory. Italy's Riva Group said 26 November it was shutting down its Ilva steelworks in Taranto, southern Italy, in the latest twist of a legal battle that has been fought for months over the future of the plant, which is Europe's biggest.

Arcelor Mittal is leading the race to secure 40% of Europe’s steel market


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Two Indian market leaders are competing for the takeover of Europe’s biggest manufacturing plant, which accounts for 7% of Europe’s output capacity.

The world’s biggest steel manufacturer, ArcelorMittal, has submitted a €1,6bn bid for Italy’s Ilva steel plant, Reuters reports. The bid also entails a commitment to a €2,3bn investment programme.

The plant is the biggest in Europe, in terms of output capacity. If Accelor Mittal did take over the plant, it would go from a 33% share of the European market to 40%.

The rival bid is led by the AcciaItalia consortium, whose offer is €1,2bn but also commits to a €3bn investment programme. The rival consortium is led by India’s JSW Steel and includes the Italian steelmaker Arvedi, and the state-owned holding company CDP.

Ilva is based inTaranto, a port city in Apulia, that is, a region with soaring unemployment. Thousands of jobs depend on the loss-making plant with the largest output production capacity in Europe.

The factory operated well under half its capacity in 2016 but is facing significant challenges, not only due to the depression of steel prices but also because of not meeting environmental standards.

The final decision is going to be made by April 6, but the deal must be approved by Italy’s Industry Ministry – as far as environmental standards are concerned – and  European Union anti-trust authorities.

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