The government on Tuesday put the troubled former ILVA steelworks in Taranto, Acciarerie d'Italia (AdI), into extraordinary adiministration and named long-time steel industry manager Giancarlo Quaranta as the extraordinary commissioner to run it.
The move has been challenged by majority shareholder ArcelorMittal with the multinational steel group, which has 62% of AdI, accusing the government of reneging on agreements.
The government, which holds the remaining 38% of AdI, rejects the charge while Industry and Made in Italy Minister Sdolfo Ursohas said there are plenty of other steel companies ready to step in and replace ArcelorMittal, the world's second biggest steelproducer.
According to the Italian media, Ukrainian group Metinvest is interested in Taranto, as are Italian company Arvedi and VulcanGreen Steel, a unit of Indian group Jindal Steel and Power.
The Taranto works, once the largest in Europe, currently employs most 10,000 workers.
Previous owners the Riva family were convicted of causing higher than normal cancer rates in Taranto, especially among children.
The plant has since been subject to an environmental clean-up but unions say it is operating at a painfully low level of production.
It has racked up debts of over three billion euros and is currently struggling to pay gas and electricity bills, or its suppliers, who received assurances from the government Mondaynight.
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