ArcelorMittal Unlikely Save Liberty Steel Dudelange in Luxembourg
Luxembourg Times reported that the embattled Liberty Steel plant in Dudelange in Luxembourg has secured payroll for two more months, with a takeover of the site by its former owner ArcelorMittal unlikely. Luxembourg’s Economy Minister Mr Franz Fayot updated members of the Parliament's economic committee on the future of the Liberty Steel plant. Mr Fayot told lawmakers that payroll for July and August has been secured. The site currently operates at reduced capacity with staff on partial unemployment because of a lack of funds to purchase raw materials. However, Mr Fayot told lawmakers there was no indication that the European Union’s competition authorities would consider an exception and allow former Dudelange plant owner ArcelorMittal to repurchase the site.
Luxembourg Prime Minister Mr Xavier Bettel's Democratic Party’s lawmaker Mr Andre Bauler said “At this moment, a takeover by ArcelorMittal is not possible. But there is also a certain consideration by the European Commission, where there is a certain degree of openness."
European Commission Vice President Ms Margrethe Vestager seemed to create an opening earlier this month for those who want to reverse the Luxembourg and Belgium factory sales by ArcelorMittal to Liberty Steel in 2019. Ms Vestager, in response to four MEPs from Luxembourg and Belgium two weeks ago, wrote “EU competition law prohibits ArcelorMittal from reacquiring production sites it has decided to divest, unless it can be proven that the situation and market dynamics have changed dramatically.”
According to opposition Christian Social People's Party Member of Parliament Mr Laurent Mosar, the situation at the Dudelange plant remains precarious. He said "I think Mr Fayot was relatively clear when he says that he's not excluding any option including taking a share of the steel company as earlier governments have when important companies like Cargolux or BGL bank have faced financial trouble. The main risk is that creditors force Liberty Steel to sell the Dudelange plant in an asset liquidation process, with unpredictable consequences. The essential question is how long the government will continue to accept this very difficult situation.”
Belgian newspapers had reported that the government of the French speaking Belgian region of Wallonia last month agreed to loan Liberty Steel money that could be used to organise the sale of the Liège and Dudelange plants.
ArcelorMittal was forced to sell the Liège and Dudelange plants along with others in Italy, Romania, Macedonia and the Czech Republic in order to buy Europe's largest steel factory in Italy. Liberty Steel stepped in as the European Commission sought to ensure the steel market remained competitive.