Arcelor takeover of Liberty Steel plant unlikely

The Liberty Steel plant in Dudelange Nader Ghavami

The Liberty Steel plant in Dudelange Nader Ghavami

The embattled Liberty Steel plant in Dudelange has secured payroll for two more months, lawmakers heard on Wednesday 21 July, with a takeover of the site by its former owner ArcelorMittal unlikely.

Economy minister Franz Fayot (LSAP) on Wednesday updated members of the parliament’s economic committee on the future of the Liberty Steel plant in the south of the country.

Liberty is facing financial difficulty following the collapse of its main financier, UK lender Greensill Capital. As part of restructuring plans, the company announced that its Luxembourg site as well as plants in nearby Liège and Italy would merge with the company’s Romanian outfit.

Fayot told lawmakers that payroll for July and August has been secured. The site currently operates at reduced capacity with staff on partial unemployment because of a lack of funds to purchase raw materials.

Liberty Steel is in the process of offloading a number of its sites, with Luxembourg steel giant ArcelorMittal being one of the potential buyers of the Hayange steelworks in France.

But Fayot said it is unlikely that the company will buy back the Dudelange site, which it was forced to sell because of EU rules as part of a 2018 acquisition deal of Italy’s Ilva steelworks.

EU competition laws prohibit ArcelorMittal from buying back the site unless it can prove that the situation and market dynamics had changed dramatically. Fayot said such a move was not currently on the agenda.

He reiterated the possibility that national investment body SNCI could invest in the site but only if industrial partners are lined up for the project.