Italy: Rome promises “up to a billion euros” to help the ex

The site of the ex-Ilva steelworks stands out behind the Tamburi district in Taranto, Puglia, November 8, 2019
The site of the ex-Ilva steelworks stands out behind the Tamburi district in Taranto, Puglia, on November 8, 2019 ( ANDREAS SOLARO / AFP/Archives )

The Italian government pledged on Wednesday to provide the ailing steel group Acciaierie d’Italia, which manages the giant ex-Ilva steelworks, state aid of up to one billion euros to revive its activity and enable it to settle its debts to its energy suppliers.

During a council of ministers, the government adopted a decree-law authorizing the release of “up to one billion euros to guarantee the operation” of the site.

The Italian State had entered in April 2021 to the tune of 38% in the capital of this steel mill, the remaining 62% of which is held by the Franco-Indian steel giant ArcelorMittal.

The government press release also mentions a new agreement between the shareholders providing for “the relaunch of the site” and “the industrial conversion of the facilities to make them viable”.

Business Minister Adolfo Urso has also convened a meeting of all stakeholders for January 19: shareholders, trade unions and institutional players.

The steelworks, located in Taranto in Puglia (south) is currently far from operating at full speed. The site “will only produce three million tonnes of steel this year when it should have produced six,” Mr. Urso said in mid-December.

The steel mill “is accumulating an excessive debt, in particular towards its energy suppliers, we must absolutely intervene with an industrial plan” allowing it to regain its first place in Europe, he continued.

“We do not accept the decline of the old Ilva, we will not nationalize it, we believe that it is necessary to immediately create this industrial plan with the parties concerned,” he said.

The government has been conducting difficult negotiations for several weeks with ArcelorMittal aimed at reviving production at the steelworks, which has been in the grip of a liquidity crisis for several months.

Rome, which should rise to 60% of the capital of the former Ilva in May 2024, had considered for a time to bring forward this takeover to directly manage the company, but will finally respect this deadline, according to the Italian press. .

“We have a frank and close confrontation with ArcelorMittal,” Urso said in a recent interview with the La Stampa daily.

The decision of the management of the factory to suspend its contracts with 145 companies in the supply chain had sparked protests in mid-November from the government and the unions, which fear for the 2,000 jobs linked to this activity.

ArcelorMittal had taken over in 2018 the very polluted site of the former Ilva, placed under state administration in 2015 after a series of financial and legal setbacks.

The steel giant had pledged to invest in the production of “low-carbon” steel and to increase the production of the steelworks to 8 million tonnes in 2025.

Two former owners of the steel plant, Fabio Riva and his brother Nicola, were sentenced in May 2021 to more than 20 years in prison for toxic emissions that led to hundreds of deaths.

According to the prosecution, at least 400 premature deaths recorded near the Ilva steelworks and caused by cardio-respiratory diseases and cancers are attributable to toxic emissions from the blast furnaces.

Italy: Rome promises “up to a billion euros” to help the ex-Ilva steelworks