European Union anti-trust authorities have opened an investigation into global steel giant ArcelorMittal’s bid to buy struggling Italian steel producer Ilva, officials said Wednesday, November 8.
The €1.8 billion (US$1.9 billion) deal would see ArcelorMittal join forces with Italy’s Marcegaglia to snap up the heavily indebted company, which employs 14,000 people.
“The European Commission has opened an in-depth investigation to assess the proposed acquisition of Ilva by ArcelorMittal under the EU merger regulation,” said the Commission, the executive of the 28-nation EU.
“The Commission has concerns that the merger may reduce competition for a number of flat carbon steel products,” the Commission said in a statement.
The Commission now has until March 23, 2018, to decide on whether competition rules would be violated and approve or reject the proposed merger.
The EU’s antitrust commissioner Margrethe Vestager said European industries dependent on steel employ 30 million people and need to buy the material at competitive prices to compete globally.
“This is why we will carefully investigate the impact of ArcelorMittal’s plans to buy Ilva on effective competition in steel markets,” Vestager said in the statement.
ArcelorMittal has pledged to keep at least 10,000 employees “for the entire duration of the industrial plan” following negotiations with unions.