Industry: The world’s largest steelmaker plans to sell its stake in Luxembourg’s biggest energy firm, as ArcelorMittal continues to divest “non-core” assets.
ArcelorMittal is selling its 23.48% share in electricity producer and distributor Enovos International.
A fund managed by AXA Private Equity is paying a total of €330 million for the stake in a two-stage deal. Half of the purchase price will be paid when the deal closes, which is expected at the end of June if the transaction is approved by regulators. AXA then has up to two years to pay the remaining 165 million euro to ArcelorMittal.
Enovos International was formed through the merger of three energy companies in 2009, and today sells power in Luxembourg, Belgium, France and Germany.
Enovos’ remaining shareholders include the Luxembourg state, the City of Luxembourg, and French and German utilities.
This is the second major deal that ArcelorMittal has announced this week. During its annual general meeting on Tuesday, the steel giant said it would sell its 45.33% stake in engineering firm Paul Wurth, which builds blast furnaces for ArcelorMittal and several other international competitors. Paul Wurth separately confirmed that discussions were being held with Düsseldorf-based group SMS “regarding a close co-operation.”
While it expects to earn more than $4 billion in net profits for the first half of 2012, ArcelorMittal faces slowing growth in global demand for steel, industry-wide production overcapacity in Europe, and net debt of more than $20 billion.