Brussels - ArcelorMittal, the world’s largest steelmaker, has agreed to sell a 50% stake in its shipping business, the first step in its plan to offload $2 billion of assets by the middle of 2021 to reduce its debt.
The company, whose net debt stood at $10.7 billion at the end of September, said on Monday the sale of the stake in Global Chartering Ltd (GCL) to DryLog Ltd would cut its debt by $530 million. It has a target to pull it below $7 billion. ArcelorMittal said it expected to close the deal before the end of this year.
GCL operates 28 dry cargo vessels, 25 of which are on long-term leases and three owned outright, and will continue to handle a share of ArcelorMittal’s shipments. Drylog is a subsidiary of Greek shipping company Ceres.
Last year the steel giant had spent 150 million dollars overall in enlarging its fleet, with the acquisition of a fourth vessel, a 81,000 dwt bulk carrier from the Greek company Capital Management Services, in a deal worth $30.5 million and of two new ships, 180,000 dwt each.
ArcelorMittal, which accounts for about 6% of world's steel production, had tried to walk away from a 2018 deal to buy Europe's largest steel plant in Taranto, Italy, after parliament scrapped a guarantee of legal immunity from prosecution over environmental risks during a clean-up of the heavily polluting factory.
But in November, the government of Rome and ArcelorMittal agreed to develop a new industrial plan for the site that employs around 8.200 workers in Taranto, a city in Italy’s underdeveloped south.