ArcelorMittal decries fate of Italian mill

Luxembourg-based global steelmaker ArcelorMittal has released a statement in response to the Italian government’s placement of Acciaierie d’Italia SpA (ADI) into “extraordinary administration,” or bankruptcy.

ArcelorMittal says the government made the move at the request of Invitalia, an Italian government-linked investment entity that has been ArcelorMittal’s partner in investing to keep ADI viable.

ADI’s largest steelmaking asset is a sizable blast furnace/basic oxygen furnace (BOF) complex in Taranto, Italy. ADI says it has been in “a process of deep transformation” that entails in part installing technologies to enable the mill to use hydrogen and renewable energy to produce 4 million tons per year of steel.

In its statement, ArcelorMittal says that project and the overall health of ADI has been put at risk by Invitalia delivering less than one-third of the 2 billion euros ($2.16 billion) of support measures it offered at the time the public-private partnership with Invitalia was established.

“Earlier today the Italian government announced that it has placed ADI into extraordinary administration subsequent to the request of Invitalia, thereby passing control of the company from its current shareholders, ArcelorMittal and Invitalia, to government appointed commissioners," the company says. "This ends ArcelorMittal’s involvement in ADI, which started in 2018.”

Much of the rest of the statement offers ArcelorMittal’s view that it invested heavily and met its commitments relative to ADI, while Invitalia did not.

“ArcelorMittal has been fully committed to the people and assets of ADI—then known as Ilva—investing over 2 billion euros,” the company says. “ADI also benefited from hundreds of millions of euros of credit through the provision of raw materials by ArcelorMittal."

After accusing Invitalia of delivering less than one-third of the 2 billion euros ArcelorMittal says the agency had pledged, ArcelorMittal says it put forward pragmatic proposals to address the shortfall. “When we were not able to agree on acceptable terms, we also offered to sell our shareholding in ADI to Invitalia [but] the discussions, despite ArcelorMittal’s best efforts, were not successful,” the steelmaker says.

“An already complicated turnaround was made even more challenging by the instability caused by the temporary removal of criminal immunity applicable during the implementation period of the environmental investment program, the demand environment during the COVID-19 crisis and the energy crisis in Europe last year.”

At the conclusion of the statement, ArcelorMittal writes, “For the people and communities of ADI, ArcelorMittal hopes that a future can be secured that will bring much needed stability.”