As of: January 26, 2024, 8:53 p.m
By: Lisa Mayerhofer
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Europe's largest steelworks in Italy is bankrupt and is in danger of falling into state receivership.
This could cost Italian and European taxpayers a lot.
Taranto - Italy started the new year with a serious steel crisis: Europe's largest steelworks in Taranto in southern Italy, which belongs to the company Acciaierie d'Italia (ADI), is bankrupt.
The Italian state should now place the company “temporarily” under state receivership, as
Wirtschaftswoche
reports.
However, this could cost both Italian and European taxpayers a lot.
Steel plant in Italy bankrupt: major shareholder no longer wants to give money
The bankruptcy was preceded by a long period of infirmity: Acciaierie d'Italia has been under fire for years because the steelworks caused billions in losses and apparently also caused respiratory illnesses and cancer.
Now the company, which has accumulated billions in debt, has been unable to pay its bills for a long time and the banks are no longer granting loans.
Europe's largest steelworks just outside Taranto.
© A. SOLARO/AFP
However, major shareholder Arcelor-Mittal, which holds 62 percent of the shares in ADI, refuses to inject money.
Arcelor-Mittal had already invested billions over the years - with no prospect of improvement.
The steel giant, which employs more than 10,000 people and on which numerous service providers and suppliers in the region depend, is now threatened with a production stop.
The Italian state, which holds the remaining 38 percent shares, would therefore like to continue operating the company.
Billions in investment through EU money?
However, according to several reports, no agreement could be found between Italy and Arcelor-Mittal.
There is now a threat of nationalization, even if Italian Prime Minister Giorgia Meloni would prefer to avoid it, reports the
Frankfurter Allgemeine Zeitung
.
But finding a private investor is proving difficult given the precarious situation.
However, if no investor can be found, the Italian state - and thus also the Italian taxpayer - will have to step in, willy-nilly.
The steelworks also needs billions in investments to convert to climate-friendly production.
The focus is on the EU and its money: around 2.3 billion euros will come from Europe, writes
Wirtschaftswoche
, for example from the European reconstruction program or the RePowerEU program.
Hundreds of deaths from pollution
The conversion of the steelworks in Taranto would definitely be necessary: thousands of cancer and respiratory diseases as well as hundreds of deaths are “proven” to be due to pollution from the steelworks, explains the
Stuttgarter Nachrichten
.
That's why the plant was confiscated ten years ago and was temporarily under the control of state commissioners.
Still, little has changed.