US Steel Kosice interest may return: Metinvest

Metinvest says its interest in US Steel Kosice may resume in future but the invasion of Ukraine by Russia is currently dampening any acquisition potential.

Asked by Kallanish if it is in talks with US Steel to acquire its Slovakian plant, a spokesperson for the Ukrainian steelmaking group says: “US Steel Kosice is a high-quality asset that, before Russia’s military invasion of Ukraine, could have been in the area of interest of Metinvest Group. In the future, interest in this asset may resume. However, at the moment, the group’s main priority is to maintain the efficiency of its enterprises and our employees.”

USSK meanwhile tells Kallanish it “does not comment on speculation”.

According to media reports, the idea of such a deal would be to restore the vertical integration of the Metinvest Group, which has several assets in Italy, Bulgaria and the UK, and lost its Mariupol-based steelmaking plants to Russian occupation.

Previously, the European assets received slab, mainly from Mariupol-based Azovstal (see Kallanish passim). Since the outbreak of war, the group has switched to purchasing semi-finished products from China and other countries.

The production capacity of US Steel Kosice is 4.5 million tonnes/year. The company produces a wide range of sheet products, including for the automotive industry. However, its rolling capacity has been underutilised in recent months due to falling demand for steel products in the EU. One of the plant’s blast furnaces has been decommissioned.

Metinvest decreased crude steel production in January-September by 62% on-year to 2.7 million tonnes due to the ongoing Russian-Ukrainian war (see Kallanish passim). Pig iron output decreased by 65% to 2.47mt.

However, it significantly increased its merchant iron ore pellet shipments to Central and Eastern Europe in the third quarter by 44% versus Q2 to 835,000 tonnes, despite iron ore products output falling overall.

Svetoslav Abrossimov Bulgaria