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Business Times reports that last-ditch efforts are under way to save troubled steelmaker ArcelorMittal SA’s (Amsa’s) long-steel plants in Vereeniging and Newcastle, where 3,500 jobs are on the line.
Amsa, in talks with the Industrial Development Corporation (IDC) and the Department of Trade, Industry and Competition (DTIC) is seeking a R3.1bn rescue package. Amsa also wants relaxation of competition laws – so it can merge with smaller steel mills – and a cut in its Eskom bill. Tebogo Makube of the DTIC said they believed Amsa’s long-steel business could still be saved and the government was looking at long-term solutions to avert job losses. He added that the DTIC would also explore options to retain the capacity to manufacture long-steel products in SA if Amsa could not continue to operate this business. Makube advised that the government had made available R380m to Amsa to keep the plants running and indications were that the Newcastle plant could operate for another 12 months with additional funding. Amsa has reportedly applied to the Unemployment Insurance Fund for money to partly cover the salaries of the 3,500 affected workers. The IDC provided the steel producer with R1.2bn of working capital last month. But, a source described Amsa’s attempt to set conditions as “audacious” and commented: “You cannot be asking for money and dictating the terms on which you should be given this money. You are asking for help but are saying ‘do the following for me and do that for me’.” Another industry player criticised Amsa’s attempt to negotiate lower electricity tariffs with Eskom.
- Read the full original of the report in the above regard by Dineo Faku at Business Times (subscriber access only)
- Read too, ArcelorMittal SA seeks R3.1bn rescue package for mills, at Fin24 (subscription or trial registration required)
Get other news reports at the SA Labour News home page