LONDON The French
government has backed away from a threat to nationalize
ArcelorMittal SAs Florange steel plant after the company
said it would preserve jobs and invest more at the site.
The agreement, reached Nov. 30,
will continue with its process of shutting liquid steel
production at the site.
The deal will not involve the
restart of Floranges two blast furnaces, which had been a
key demand from Frances government and Florange
workers unions. But ArcelorMittal has pledged no more
compulsory redundancies among more than 600 staff and has
promised to invest 180 million ($234 million) in
downstream operations, French Prime Minister Jean-Marc Ayrault
said in a statement.
"Weak activity in Europe will
not allow for the prospect of restarting the blast furnaces in
the short term," he said, accepting the Luxembourg-based
companys basic point that hot metal production at
Florange was not currently viable.
The company has agreed to keep
the furnaces, which were idled 18 months ago, in a state where
they might be restarted as part of a test project for producing
environmentally friendly steel, Ayrault said, rejecting what he
called the hypothesis of nationalization.
"Nationalizationthat is to
say, the expropriation for the good of the
publicmay well be necessary in specific historical
circumstances or to safeguard the best interests of the
nation," he said. "But it is not effective against a problem or
opportunity for a company facing a problem of
Meanwhile, ArcelorMittal Flat
Carbon Europe vice president Henri Blaffart highlighted the
positive aspects of the deal.
"After months of uncertainty, we
have finally reached an agreement on the future of our
operations in Florange," he said. "In the context of the
current economic environment, this is a good agreement (which)
will allow Florange to focus on developing its downstream
activities and producing value-added steels."
A version of this article
was first published by AMM sister publication Steel
First. Staff in Shanghai contributed to this