Agreement between ArcelorMittal and NSSMC regarding joint venture to acquire Essar Steel India Limited
02 Mars 2018 - 7:01AM
2 March 2018
ArcelorMittal (The Company) has signed a joint venture formation
agreement with Nippon Steel & Sumitomo Metal Corporation
(NSSMC) in relation to its offer to acquire Essar Steel India
Limited (Essar Steel). The Company's subsidiary ArcelorMittal India
Private Limited (AMIPL) submitted a Resolution Plan for Essar on 12
February, which outlined the intention to have NSSMC formally join
its bid for Essar Steel. Should the submitted Resolution Plan be
selected and formally accepted by India's National Company Law
Tribunal, ArcelorMittal and NSSMC would jointly acquire and manage
Essar Steel.
In its Resolution Plan, AMIPL set out a detailed industrial and
turnaround plan aimed at restoring Essar Steel's fortunes, enabling
it to realise its full potential and participate in the anticipated
steel demand growth in India.
Commenting, Mr. Lakshmi Mittal, Chairman and CEO,
ArcelorMittal, said:
"Partnering with NSSMC for Essar Steel was always our intention
and adds further strength to our offer. Combining our
experience and expertise creates a powerful partnership that has a
proven track record - our rich history of positive collaboration
dates back more than 20 years with three joint ventures in the
US. We believe that together we can contribute our knowledge
and technology to support a rapid turn-around in Essar's
performance, enabling it to increase production, enhance its
product capabilities and make a meaningful contribution to the
future growth of India's manufacturing sector and the development
of its economy."
ArcelorMittal and NSSMC have operated I/N Tek and I/N Kote in
Indiana, USA, under joint venture agreements since 1987. I/N Tek
and I/N Kote are high-added value downstream steel finishing
facilities which serve the automotive and domestic appliance
markets.
More recently, in 2014, ArcelorMittal partnered with NSSMC on
the acquisition of AM/NS Calvert, a state-of-the art downstream
finishing facility in Alabama, USA. The facility, which opened in
2010 and has a 5.3 million tonne capacity, was the largest newly
constructed steel facility in the US in 40 years but had failed to
reach its potential. A major investment programme has been
undertaken following the acquisition. The programme focussed on
improving the facility's finishing lines to enable the production
of higher-added value steel products, including production of
Usibor®, ArcelorMittal's flagship advanced high-strength steel for
the automotive sector, and increasing slab staging capacity and
efficiency. These investments have helped to facilitate a rapid
improvement in AM/NS Calvert's performance: capacity utilisation
rates have improved by over 20 per cent; shipments to the
automotive sector more than doubled between 2015 and 2017; and
productivity at the hot strip mill has increased by over 1 million
tonnes since the acquisition.
Ends
About ArcelorMittal
ArcelorMittal is the world's leading steel and mining company,
with a presence in 60 countries and an industrial footprint in 18
countries. Guided by a philosophy to produce safe, sustainable
steel, we are the leading supplier of quality steel in the major
global steel markets including automotive, construction, household
appliances and packaging, with world-class research and development
and outstanding distribution networks.
Through our core values of sustainability, quality and
leadership, we operate responsibly with respect to the health,
safety and wellbeing of our employees, contractors and the
communities in which we operate.
For us, steel is the fabric of life, as it is at the heart of
the modern world from railways to cars and washing machines. We are
actively researching and producing steel-based technologies and
solutions that make many of the products and components people use
in their everyday lives more energy efficient.
We are one of the world's five largest producers of iron ore and
metallurgical coal. With a geographically diversified portfolio of
iron ore and coal assets, we are strategically positioned to serve
our network of steel plants and the external global market. While
our steel operations are important customers, our supply to the
external market is increasing as we grow.
In 2017, ArcelorMittal had revenues of $68.7 billion and crude
steel production of 93.1 million metric tonnes, while own iron ore
production reached 57.4 million metric tonnes.
ArcelorMittal is listed on the stock exchanges of New York (MT),
Amsterdam (MT), Paris (MT), Luxembourg (MT) and on the Spanish
stock exchanges of Barcelona, Bilbao, Madrid and Valencia (MTS).
For more information about ArcelorMittal please visit:
http://corporate.arcelormittal.com/
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