ArcelorMittal stops production at Newcastle plant
ArcelorMittal South Africa (AMSA) has ceased long steel production at its Newcastle plant
Image: File
Despite a R1.683 billion loan from the Industrial Development Corporation (IDC) and additional support from the Unemployment Insurance Fund, ArcelorMittal South Africa (AMSA) has ceased long steel production at its Newcastle plant and placed most facilities under care and maintenance.
This comes almost a week after the Labour Court ordered the company to reinstate workers at its Newcastle and Vereeniging plants who were retrenched earlier this month.
The ruling required AMSA to restart consultations with the union and pay salaries for the period affected, as the company explores alternatives to job losses.
The company announced in a brief statement via the JSE Limited Stock Exchange News Service (SENS), stating that the process to place the Longs business into care and maintenance has proceeded.
"The process to place the Longs Business into care and maintenance has proceeded, and most plants at Newcastle. Works have been placed into care and maintenance, and production has ceased. Limited trading will continue to dispatch the remaining stock".
The company added that the ongoing engagements to explore alternative solutions continue. The company is also currently engaged with IDC over a potential rescue.
"Engagements to explore alternative solutions continue. Further announcements will be made in relation to these matters as and when appropriate".
"Accordingly, shareholders are advised to continue to exercise caution when dealing in the Company’s securities until a further announcement is made".
IOL also previously reported that NUMA said that "it was time for the government to nationalise AMSA, and that these endless negotiations between IDC and AMSA must be brought to a close".
"The government must do everything to ensure that Newcastle is not closed. Nationalization of AMSA will also mean that the government must take over AMSA entirely, and this includes the plant in Saldanha Bay (which has been mothballed), in the interest of driving local manufacturing and industrialization".
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