The Italian government has issued a decree enabling Invitalia, the state shareholder of Acciaierie d’Italia (ADI), to interrupt the shareholder corporate continuity and put the company in extraordinary administration within fourteen days, union sources that met the Italian government told S&P Global Commodity Insights on Jan 18.
The decree is set to be signed on Jan. 19 by the President of the Republic, Sergio Mattarella, and paves the way to remove its main shareholder, ArcelorMittal, the sources said.
The Italian government was working to find a solution for the second largest Italian flat steel producer, but last week failed to find an agreement with ArcelorMittal to inject more liquidity to keep running what it was once the largest European steel company. At the moment only two blast furnaces are operational and production is at its lowest-ever level. The company this week was on the brink of having its gas supply cut and a court said that the Italian gas company Snam could stop supplying energy on unpaid bills, although ADI appealed it.
“ArcelorMittal is not a problem anymore and now there are fourteen days to understand if it actually abandons by acknowledging the errors or abandons asking for compensation for damages, but this will not cause any problem to production continuity, because the Government reiterated that there are Eur320 million available for current management and the possibility of opening to private partners as well. All this will happen after making the plants and workers safe,” Rocco Palombella, UILM union representative, said.
“We reiterate our opposition to the extraordinary administration, which in 2015 made a clean sweep and created a disaster for related companies. However, we have received reassurances from all the Ministries involved on safeguarding employment and on the management of a possible administration which will only be temporary and which aims to find a private investor worthy of the former Ilva,” he added.
With this last move from the Italian government the situation is likely to go back to 2015, when the company, formerly known as Ilva, was put under special administration and then sold to ArcelorMittal in 2018. ArcelorMittal, Europe’s largest and the world’s second largest steelmaker, owns 62% of ADI. The other 38% is owned by Invitalia, Italy’s National Agency for Investment Attraction and Business Development that is part of the Ministry of Economy.
An ADI spokesperson declined to comment.