July 25, 2018 / 4:33 PM / 22 days ago

Italy's deputy PM says ArcelorMittal's Ilva offer not sufficient on jobs

ROME (Reuters) - Italy’s government, which has questioned the validity of ArcelorMittal’s (MT.AS) planned takeover of Italian steelmaker Ilva, on Wednesday said it was not happy with new bid proposals put forward by the steel giant.

FILE PHOTO: Luigi Di Maio speaks at the Italian Business Association Confcommercio meeting in Rome, Italy, June 7, 2018. REUTERS/Tony Gentile/File Photo

Italy’s deputy prime minister Luigi Di Maio said that while the Luxembourg-based ArcelorMittal had improved its environmental pledges, it could still do more on the jobs front.

While putting pressure on ArcelorMittal to enhance its original offer, the new coalition has also ordered a review of the 2017 tender process, warning it will scrap the deal if it finds serious irregularities.

“We will pursue these two paths in parallel because we must be ready for all eventualities,” said Di Maio, who is head of the anti-establishment 5-Star Movement and also serves as both industry and labor minister.

ArcelorMittal (MT.AS) said on Wednesday it had presented Di Maio with “additional proposals”, adding that it hoped it could shortly complete its planned takeover of Ilva.

“We have participated in this tender in good faith and remain hopeful that we will be able to complete the transaction soon,” it said in a statement.

The industry ministry said on Tuesday the tender review would take 30 days and came after Italy’s anti-corruption body suggested the previous centre-left government might have failed to follow the correct procedures for such a public offer.

ArcelorMittal agreed last year to buy Ilva, Europe’s largest steelworks, and had been due to take it over on July 1.

However, the government delayed the handover, heightening speculation about the future of the troubled Ilva, which was placed under state-supervised special administration in 2015 three years after magistrates had intervened in the company, saying it had to be cleaned up or shut down.

ArcelorMittal promised last year to pay 1.8 billion euros to acquire Ilva and then invest 1.2 billion to boost productivity and a further 1.1 billion to curb pollution at the firm’s main Taranto plant in the southern heel of Italy.

It has also told unions it plans to reduce the Taranto workforce to around 7,600 from 10,900 now.

Di Maio said ArcellorMittal had improved its environmental commitments, but added that the labor plan was “not satisfying”. He gave no further details.

“ArcerolMittal does not want that its updated proposal be made public because it is worried about competitors getting hold of the information,” Di Maio said.

Officials in Taranto have said Ilva is losing one million euros a day and warn that unless the ArcelorMittal deal is rapidly sealed, the business might be forced to close.

Ilva is one of Italy’s largest industrial concerns and its closure would be a blow to local businesses that rely on it for much of their steel production.

Additional reporting by Francesco Guarascio; Writing by Crispian Balmer; editing by David Evans

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