ROME Feb 10 The world's biggest steel producer
ArcelorMittal is among parties considering buying Italian
steelmaker Ilva, depending on the cost of an environmental
cleanup plan ordered by the government, several sources said on
Ilva, controlled by the Riva family, runs Europe's biggest
steel plant in the southern Italian city of Taranto. But the
maker of flat steel products used by carmakers, electrical
appliance manufacturers and shipbuilders, has been at the centre
of a lengthy controversy over pollution.
"In the last few days I learned that ArcelorMittal has shown
an interest in buying Ilva," a source close to the situation,
who asked not to be named, told Reuters.
The Riva family, Ilva, and ArcelorMittal all declined to
An industry source who also did not want to be named said
Chinese and Russian players, as well as Italian steel groups
Marcegaglia and Arvedi, were interested in Ilva.
Arvedi declined to comment and Marcegaglia was not
immediately available for comment.
Any eventual offer could be hindered by the cost of the plan
ordered by the government to reduce pollution levels around the
Taranto plant, estimated to reach around 3 billion euros ($4
billion), the sources said.
"Ilva is losing money so finding a solution for the plant
has become more pressing. The problem is that it is hard to plan
anything until there is more clarity on the environmental
restructuring," the industry source said.
The Italian government put Ilva under special administration
last year after prosecutors alleged that toxic emissions from
the Taranto plant caused abnormally high rates of cancer and
respiratory illnesses in the surrounding region. Several former
executives were arrested.
The group denies its operations were responsible for any
Talk of an investment by ArcelorMittal into Ilva, which
would give the Luxembourg-based giant greater control over the
price of steel in southern Europe, first circulated a year ago
and has resurfaced in the press in recent weeks.
But Colin Hamilton, the head of commodities research at
investment bank Macquarie, said he was sceptical ArcelorMittal
shareholders would back further investments following a November
purchase of a ThyssenKrupp steel plant in the United States.
A source at Ilva said the Taranto plant was producing 20,000
tonnes of steel a day, equivalent to about 7 million tonnes per
year. This compares with an output of 6.3 million tonnes in 2013
and 8.3 million tonnes in 2012.
In recent days, the company has proposed cutting the working
hours for about 3,500 employees, constituting about a third of
workers at the Taranto plant, as a means to save money.
($1 = 0.7327 euros)
(Additional reporting by Silvia Antonioli and Maytaal Angel in
London, James Mackenzie in Rome; Writing by Naomi O'Leary;
Editing by Anthony Barker)