France reaches '146m pounds deal' with Arcelor Mittal to keep steel plant 'alive'
French authorities have finally reached a peace deal in their dispute over the future of steel giant ArcelorMittal, which is owned by Indian business tycoon Lakshmi Mittal.
ArcelorMittal agreed to invest 146 million pounds over five years and cancel plans for 650 redundancies at its steelworks in Florange, in the eastern region of Lorraine.
In return, Paris abandoned a threat to nationalise the factory and re-sell it to a private buyer, the Independent reports.
According to the paper, the government was forced to accept that two shuttered blast furnaces would not re-open immediately.
Instead, ArcelorMittal will develop other profitable activites at the site, such as the production of steel plate for the German car industry, the paper said.
Three hours before the deadline for a deal, Prime Minister Jean-Marc Ayrault said a compromise had been reached.
He said jobs would be preserved by a "programme of investment" in cold steel activities.
The blast furnaces, which produce "raw" or hot steel, would not re-open, but be mothballed until they could be converted to possible experimental use in environment-friendly steel-making.
According to the paper he insisted that there would be no compulsory redundancies.
In return for the "unconditional promises" by ArcelorMittal, Ayrault said Paris had dropped its threat to nationalise the complex and sell it within a matter of months for 400 million euros to an undisclosed potential buyer.