ArcelorMittal South Africa Rejects Green Buyout Proposal

ArcelorMittal South Africa declined a 19-billion rand buyout offer from Networth Investments, aiming to revitalize the country's steel industry via green technologies. The firm disputed the authenticity of the bid. CEO Harold Vermaak planned a strategic company overhaul to focus on high-value stainless steel production.

ArcelorMittal South Africa (AMSA) has turned down a 19-billion rand acquisition proposal from local entity Networth Investments. Networth aimed to breathe new life into the struggling South African steel industry by implementing cutting-edge green technology and shifting focus to more lucrative stainless-steel production, drawing inspiration from successful models in India.

Networth CEO Harold Vermaak disclosed to Business Report their intention to acquire a majority of AMSA's shares, including a portion held by international investors, via a leveraged buyout. However, AMSA dismissed the offer as neither firm nor bona fide. Vermaak envisioned transforming AMSA's operations towards higher-value production, supported by vendor finance from European steel partners and a strategic offtake agreement.

Despite AMSA's ongoing financial challenges, including significant losses and debts, Vermaak believed enhancing the steel industry through innovation and collaboration could spur economic growth, job creation, and increased exports of green steel. AMSA's spokesman cited market downturns and rising costs as reasons for the refusal, indicating the steel sector's persistent difficulties.

(With inputs from agencies.)