Global steel giant ArcelorMittal and Italian steel company Marcegaglia have presented their joint non-binding offer for Italy-based Ilva Group i.e., for its rolling mills in Genova Cornigliano and Novi Ligure and its much-troubled plant in Taranto, as reported by Italian media sources.
The joint offer of the world's largest steelmaker and the Italian steel processor and distributor does not include a monetary offer, but requires that any accountability relating to Ilva's outstanding legal problems will remain within a "bad company", while the industrial activity will be concentrated within a "good company". In such a scenario, the bad company would be the entity called to answer for any legal problems arising from past management of Ilva. The new company, which would become part of the international network of ArcelorMittal Group, would assume the financial burdens resulting from maintenance of the plants, as well as potential losses that may be incurred in the first 12 months after the relaunch of Ilva.
Meanwhile, an additional offer for Ilva is expected from Italian steelmaker Arvedi. The Cremona-based group said it will act alone or with a partner. In either case, both ArcelorMittal-Marcegaglia and Arvedi would be in a partnership with Italian state-backed lender Cassa Depositi e Prestiti.
Previously, Piero Gnudi, special commissioner for Ilva, said that the maintenance of jobs and the environmental upgrading of the Taranto-based plant are conditions that Ilva's buyer(s) will have to respect. The total costs of improving environmental standards at Ilva to comply with the Italian government's Integrated Environmental Authorization are expected to reach €1.8 billion. The objectives of the Integrated Environmental Authorization are expected to be 80 percent completed by next July and fully completed by August 2016.
Last week, banks granted Ilva another €125 million after the €125 million already disbursed in mid-September. The new tranche of the loan allows special commissioner Gnudi to deal with a series of deadlines in December (payment of salaries, performance bonuses, etc.), and to provide additional support for the company's suppliers, which in October had received €34 million in payment for overdue invoices.