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Italy Blocks ArcelorMittal Deal With Golden Power
1 Sep
Summary
- Italian government used golden power to impose takeover restrictions.
- ArcelorMittal abandoned its planned acquisition of a CLN joint venture.
- Domestic rival Acciaieria Arvedi SpA is set to take control.
ArcelorMittal has withdrawn its planned takeover of a joint venture with CLN-Coils Lamiere Nastri SpA, following intervention by the Italian government. The Italian government exercised its 'golden power' — a tool designed to protect strategically important companies — imposing conditions on the acquisition. These conditions included government approval for structural and workforce reductions and a mandate to maintain existing operations for five years.
Consequently, ArcelorMittal decided not to proceed with acquiring the remaining 51% stake in ArcelorMittal CLN Distribuzione Italia Srl. This development allows Acciaieria Arvedi SpA, an Italian steelmaker that had previously bid for the joint venture, to present a new binding offer. Arvedi plans to increase production following the potential acquisition.
The government's use of golden power reflects a broader strategy to safeguard national interests, protect domestic companies, and preserve jobs. This intervention echoes similar actions, such as derailing UniCredit's bid for Banco BPM SpA and influencing Pirelli SpA's shareholder structure. The ArcelorMittal-CLN joint venture, formed in 2015, is a significant distributor of flat carbon steel products, employing approximately 400 people and reporting €801 million in revenue in 2022. CLN is also undertaking an asset disposal plan amidst the automotive industry's downturn.
