ArcelorMittal has reached an agreement with the Italian authorities over the future of the former Ilva group, amending the existing lease and purchase agreement. The new resolution stops both the ongoing legal procedures and the possibility of ArcelorMittal to immediately terminate its control over the Italian integrated steelmaker.
"The amendment agreement outlines the terms for a significant investment by Italian state-sponsored entities into AM InvestCo, thereby forming the basis for an important new partnership between ArcelorMittal and the Italian government. The equity investment by the Italian Government in Ilva, to be captured in an agreement to be executed by 30 November 2020, will be at least equal to AM InvestCo’s remaining liabilities against the original purchase price for Ilva," ArcelorMittal says in a note sent to Kallanish.
In the agreement the parties confirmed the intention to invest in lower-emissions steelmaking, including the construction of a DRI facility and an EAF in Taranto. The DRI plant is expected to be funded and operated by a third-party investor, with the EAF constructed by ArcelorMittal.
The agreement finally leaves ArcelorMittal with the right to withdraw from the agreement by November 2020, subject to the payment of an undisclosed sum of money. The close of the lease and purchase agreement is now scheduled by May 2022.
The local trade unions confirm that the agreement was signed and have expressed their concerns over the agreement on many issues. These include the number of workers to be retained and the industrial plan, which is still not completely clear, the unions say.