Trade union Solidarity said on Friday it was ‘hopeful’ as talks continued between ArcelorMittal South Africa (Amsa) and the Industrial Development Corporation (IDC) regarding a “potential transaction” that could possibly save 3,500 jobs at the steel company.
Workers have been in limbo since Amsa placed its long steel business in Newcastle and the Vereeniging plant on care and maintenance last year after years of runaway costs and bleeding cash.
Low demand had resulted in its Saldanha Steel plant closing in 2020.
In the half year ended June 2025, the company reported a headline loss of R1.01bn, from R1.1bn a year earlier.
Willie Venter, Solidarity’s deputy general secretary, said on Friday the talks had been positive.
“We are hopeful; we see it as very positive that talks are continuing. We are grateful to see that it seems there is progress towards finding a solution for the two plants and the whole endeavour to try to save the 3,500 jobs,” he said.
Venter said while there were no further details from Amsa at present, he hoped positive news would be forthcoming “so we can put them in a positive position about their immediate future”.
He said there had been several versions around a supposed buyout by the government and partners.
“The feedback we have includes the possible buyout of the whole of Amsa. There are also versions that they are focusing on the non-core assets, like the long steel business that is not profitable. Clarity would be good.”
According to Bloomberg, the IDC tabled a proposal for an R8.5bn bid for the business, which was rejected.
The IDC in February injected R1.7bn as part of its intervention to preserve Amsa’s operations and ensure a continued supply of essential steel.
Amsa announced on Thursday that it was “in advanced discussions to find a sustainable solution” based on a “non-binding term sheet regarding a potential transaction”.
It said the talks were subject to approval, and there was no certainty that any transaction would be concluded.
The IDC confirmed the talks with Amsa but declined to give details, saying it did not comment on operations of listed entities, including Amsa.
“Our financial interventions [with] the company are a matter of public record, and so is our decision to support the growth of mini-mills.
“We can confirm that the IDC has continued to engage Amsa, the ArcelorMittal Group, and other stakeholders, including the department of trade, industry & competition, in efforts to find a sustainable solution to the challenges facing the company.”
Amsa has been loss-making for years after grappling with the perfect storm of high electricity costs, the influx of cheap products, mainly from China, weak local demand, logistical challenges and the dearth of government infrastructure programmes.
The company closed its long steel operations last year, saying a lack of government support made its Newcastle and Vereeniging plants unprofitable. It said government policy that focused on scrap-based mini-mills rather than raw material was problematic.
It also singled out the preferential pricing system and export tax on ferrous scrap in favour of scrap-based steelmakers as among the top threats for the group.
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