Mining’s old guard needs strong medicine
A new report details subpar investor returns in the mining industry over the last decade, particularly big cap diversified companies which have not adapted to new realities.
The Italian government will fight ArcelorMittal in the courts if it goes back on a pledge to buy steelmaker Ilva, but Rome still hopes to avoid a bruising legal showdown, Prime Minister Giuseppe Conte said on Thursday.
“We would all lose if there were a legal battle, but should it happen, it will be the legal battle of the century,” Conte, himself a lawyer, told state television RAI in an interview.
ArcelorMittal said this week it was withdrawing from a deal to buy Ilva, blaming its decision on a government move to scrap previous guarantees of legal immunity during a massive clean-up operation at Ilva’s huge Taranto plant.
Conte and his infrastructure minister both declined to rule out the option of nationalising the company if talks with ArcelorMittal prove fruitless.
Conte said the government was ready to restore the legal shield if that was the sticking point, but added that ArcelorMittal’s real problem was that it no longer thought its industrial plan for the company was workable.
Conte said ArcelorMittal’s managers told him on Wednesday they could not meet their production targets for Taranto and that to be financially viable they had to shed some 5,000 employees — roughly half their Italian workforce.
The prime minister said this was unacceptable, adding that he wanted to meet ArcelorMittal’s CEO in the coming hours.
“This is not a legal problem. The problem is that their industrial plan is not sustainable,” Conte said. “We are working 24 hours a day looking at all the possible options.”
Asked whether the government may take permanent ownership of Ilva, Conte said it was evaluating all possibilities, a message reiterated later on Thursday by Infrastructure Minister Paola De Micheli.
Asked on the sidelines of a conference near Milan whether the government was ready to nationalise the steelmaker, De Micheli replied: “we are ready for everything.”
She added that the ruling coalition would remain united over the issue whatever it decides, and will “tackle negotiations with ArcelorMittal head on.”
Unions have called a 24-hour strike for Friday at ArcelorMittal’s various Italian operations to protest at its reported plans to cut jobs and possibly quit the country.
(By Giuseppe Fonte, Riccardo Bastianello, Crispian Balmer and Gavin Jones; Editing by Lisa Shumaker)
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