Italy’s federal government has offered to acquire an 18pc stake in ArcelorMittal’s Ilva steel plant through its state lender, Casssa Deposit e Prestiti or Invitalia, according to local papers.
The proposal is the government’s attempt to prevent the plant from closure or cutting jobs and comes shortly after Arcelor’s plan to cut 4,700 jobs in Ilva was rejected by the government.
The government’s draft plans lays out a path to reach a desired annual output of 8mn mt and safeguard jobs. Still, the facility will face strike action on Dec 10 as unions respond to the producer’s Nov 7 announcement on cutting 4,700 jobs.
Arcelor acquired Ilva in 2017 with plans to expand output and reduce emissions but weak steel markets led Arcelor to strike a deal with the Italian government in 2018. The producer decided to walk away from the deal last month citing bureaucratic and legal troubles, combined with low demand for steel in Europe.
In the deal, the Italian government laid out plans to increase Ilva’s output to 6mn mt from 4.5mn mt with three blast furnaces operating. Gradually the company was to lift output to 8.5mn mt per year by 2023 with staff ramped up to 11,000 workers.
However, one of these blast furnaces will stop production in 2023 and be replaced by a new electric arc furnace (EAF) that will use a hybrid solution with scrap, pig iron and direct reduced iron. The new EAF investment would be around EUR230mn and will have lower carbon emissions.