According to Bloomberg, the discussions are taking place between the South African Department of Trade and the company’s second-largest shareholder after ArcelorMittal itself, the state-owned Industrial Development Corporation (IDC).
The Newcastle facility, located in KwaZulu-Natal province, produces steel grades critical to the country’s automotive, mining, and construction sectors. However, the plant’s long-standing losses have been putting pressure on the company’s overall profitability.
ArcelorMittal South Africa had announced on April 1 that it would conduct a due diligence review regarding the IDC’s potential increase of its stake in the company.
According to sources, a decision on the plant’s future is expected in the coming days as it continues to drain the company’s financial resources.
Neither the company nor government officials have made any official public statements regarding the ongoing negotiations.
Comments
No comment yet.