Negotiations over distressed steelmaker Acciaierie d’Italia (ADI)’s sale remain ongoing, while the Italian government has confirmed its financial backing for the producer through a new decree ensuring the continuation of production.
The Taranto steelworks was damaged in May by a fire that stopped blast furnace no.1 from producing.
Union sources present at a meeting with government officials this week in Rome indicate that negotiations with Baku Steel will advance solely upon the execution of a programme agreement. This must define the responsibilities and financial contributions of the Italian authorities. The talks are said to be focusing on securing the necessary environmental authorisations for production and for the deployment of a floating storage regasification vessel off the coast of Taranto, which Baku plans to install.
“We have had no reassurance about the future and no guarantee about production continuity. The tender is at a standstill, there is no AIA [integrated environmental authorisation – Autorizzazione Integrata Ambientale], there is not a single guarantee but an idea of an uncertain programme agreement,” says Uilm union secretary Rocco Palombella in a note seen by Kallanish.
Insiders indicate significant scepticism surrounding the likelihood of a successful sale to Baku. This stems from multiple uncertainties related to the programme agreement, environmental authorisations, and the government’s financial involvement in the new entity.
The Azerbaijan consortium, which includes Baku Steel and Azerbaijan Investment Company, reportedly presented an industrial strategy along with terms that are deemed unacceptable by multiple stakeholders. The valuation of ADI’s assets is approximately €1.1 billion ($1.2 billion), with an additional €4 billion investment required. The consortium is reportedly requesting the government allocate more than €5 billion to ADI, encompassing tax credits, government-backed loans, and public investment.
The recent fire incident at blast furnace no.1 at Taranto has led to the unit’s seizure by the public prosecutor’s office in Taranto. This has prevented essential maintenance intervention required to protect the equipment. The absence of prompt intervention has jeopardised the BF, which is unlikely to be operational again before the end of the year.
Following the fire in May, the Taranto site is operating with a single blast furnace, no.4. The management has escalated the number of layoffs at Taranto to an estimated 4,000 employees (see Kallanish passim).
Natalia Capra France
