Africa’s largest steel producer ArcelorMittal South Africa (AMSA) has again postponed its plans to shut down its longs business consisting of its Newcastle and Vereeniging works as well as its AMRAS rail and structural steel subsidiary with the help of a loan to be provided by a local finance institution, according to media reports.
The Industrial Development Corporation (IDC) will provide a ZAR 1.6 billion ($87.05 million) loan to the company, enabling it to defer its closure decision until August 31 and to stave off the termination of 3,500 jobs. The loan from the IDC is repayable based on a mutual agreement dependent upon the financial performance, solvency and liquidity of AMSA’s longs business.
As SteelOrbis reported previously, after postponing it in early February this year, AMSA decided to proceed with the closure plan due to failed discussions with the government and stakeholders.