ArcelorMittal to Expand Capacity with Ilva Acquisition

ArcelorMittal and Marcegaglia have purchased Italian steel milll Ilva in a $2 billion deal expected to close June 30. The mill’s assets will be leased by the consortium AM Investco Italy Srl for $200 million per year with payments applied to the purchase price. AM Investco will receive the steel facility free of long-term debt and liabilities, along with $1.1 billion in net working capital, according to a press release by ArcelorMittal.

Ilva has been an ongoing environmental nightmare for the Taranto region. AM Investco will spend $1.2 billion to bring the mill into compliance with environmental regulations, including upgrades for air emissions and water treatment. Part of the funding will come from $320 million seized by the government from former owner RIVA Group. The mill will be upgraded with low-carbon technologies and will use cleaner burning DRI whenever economically feasible, the company said.