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.