Unions at Liberty Steel’s Dudelange facility are urging the Luxembourg government and the European Commission to take immediate action to secure the site’s future, following delayed wage payments to employees.
The OGBL and LCGB unions have commenced legal proceedings to reclaim the outstanding amount. “The potential for bankruptcy is a significant concern and is further intensifying the existing uncertainties,” unions say in a note obtained by Kallanish. “Employee resentment is heightened by late payments, especially as the end-of-year holidays draw near. This situation, which has become increasingly frequent, is exacerbated with every deadline that is not met.”
“The Liberty Steel group, already compromised by financial controversies, appears unable to fulfil its obligations to its workforce, as well as to governmental bodies, financial institutions, and creditors with whom it has accumulated substantial debts totalling several million euros in Luxembourg. No definitive sales actions have been executed by Liberty,” unions add.
Liberty counters it is “taking decisive steps to address the challenges at Dudelange” and that discussions with a strategic investor have progressed significantly. “We remain optimistic about reaching a resolution soon,” says a Liberty spokesperson.
“Additionally, another potential buyer has already visited the Dudelange site, and we understand the government is already engaged in dialogue with them. We continue to fully cooperate with all stakeholders in a transparent manner to identify a sustainable path forward and secure a new shareholder who can support the company’s future,” the spokesperson adds.
The global steel industry is currently experiencing a prolonged downturn, with market conditions deteriorating to levels even more severe than those observed during the 2008 global financial crisis and 2015 steel market crisis, Liberty points out.
The situation has prompted Eurofer to urge the European Commission to prioritise the implementation of a comprehensive European Steel Action Plan to support the sector.
Liberty Steel intends to sell Italy-based Magona, its Belgian facility in Liege, and Dudelange in Luxembourg. In May, it initiated a strategic assessment of its downstream steel plants in western Europe in response to expressions of interest from multiple parties. The objective was either to establish partnerships through long-term HRC feedstock supply contracts or to divest the units.
The businesses have a combined rolling capacity of more than 2.5 million tonnes/year. Liège and Dudelange produce galvanised HRC, while also offering tinplate for packaging and black plate as a substrate for tinplate. Dudelange is also the sole European producer of Aluzinc. Magona has a long heritage and well respected pre-painted PPGI brand, with its own port access at the plant.
Natalia Capra France
