Bengaluru — Steelmaker ArcelorMittal’s talks to sell its SA unit to state-owned Industrial Development Corporation (IDC) have stalled over valuation differences, Bloomberg News reported on Thursday, citing people familiar with the matter.
While the parties may still reach an agreement on the fate of ArcelorMittal SA before the end of a due diligence period on September 30, the company wants considerably more than what was offered, the report said.
Offers of as much as R7bn ($398.6m) for the SA unit have been discussed, the Bloomberg report said.
ArcelorMittal, its SA unit and IDC did not immediately respond to requests for comment. Reuters could not immediately verify the report.
“The company has been exploring various strategic options while the IDC has simultaneously been conducting its due diligence into the company and the government has been pursuing structural interventions,” ArcelorMittal SA said in a statement to the JSE on Tuesday.
The Luxembourg-headquartered company said in July that talks with the SA government have so far yielded little progress to avert the closure of its loss-making long steel operations at its SA unit.
In March, ArcelorMittal SA deferred the closure after IDC injected R1.68bn in cash.
The world’s number two steelmaker previously said the closure could no longer be postponed beyond September 30 unless a solution is found soon.
The IDC holds about an 8.2% stake in ArcelorMittal SA making it the second largest stakeholder after ArcelorMittal, according to data compiled by LSEG.
Reuters
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