The plants of Acciaierie d’Italia (ADI), formerly known as Ilva, have been engulfed in another workers’ strike this week.
On 21 November, workers in Taranto went on strike for 24 hours and are planning more action to protest against the perceived lack of government support for the steelmaking joint venture. They are calling for swift state intervention to nationalise the steelmaker, union sources confirm to Kallanish.
“In March, the company said it would ramp up output to 5.7 million tonnes; we are now at slightly over 3mt,” the UILM union say in a note denouncing the “dramatic situation”. The steelmaking plant in Taranto is only working with two blast furnaces while almost all finishing lines remain idle. Workers are asking the government to respect its initial commitment and inject cash into the company to make ArcelorMittal a minority shareholder, sources say.
Amid a liquidity crisis, ADI’s management recently decided to suspend its use of contractors. This, on top of almost 3,000 workers being temporarily laid off, is putting in doubt production continuity. The steelmaker is said not to be paying many of its debts.
The Italian government will inject some €1 billion ($1.03 billion) into the troubled steelmaker, economic development minister Giancarlo Giorgetti announced in August. The funds will be released thanks to a decree called “Aiuti Bis” prepared by the economic development ministry (Mise) to save the company (see Kallanish passim).
Troubled by financial hardship, the funds are becoming necessary for ADI’s survival, multiple sources confirm.
Invitalia signed an agreement in May with joint venture partner ArcelorMittal to delay the completion of its acquisition of a majority stake in ADI. According to the 2020 agreement between the two parties, Invitalia invested the first tranche of €400 million last year in AM InvestCo, the ArcelorMittal subsidiary that agreed to purchase the former Ilva plant. This provided Invitalia with joint control over AM InvestCo.
The second tranche of up to €680m was due to be paid on the closing of AM InvestCo’s purchase of Ilva, the deadline for which was end-May 2022. This would have raised Invitalia’s shareholding in AM InvestCo to 60%, giving it control over ADI. The payment of the second tranche has however been postponed to 31 May 2024 (see Kallanish passim).
In 2021, ADI posted turnover of €3.3 billion, up from €1.6 billion in 2020. Last year, the company produced 4.1 million tonnes of crude steel, an increase from 3.4mt in 2020.
Natalia Capra France
