Ascometal, one of the largest steel producers in France, is on the verge of bankruptcy, threatening the loss of 2,000 jobs. Last Friday, according to the decision of the commercial court of Paris, the external management procedure was introduced at Ascometal.
The French company has been hit by a sharp decline in steel demand in Europe, especially from the automotive sector.
In 2011, in an attempt to increase free cash flow, Ascometal entered into an investment agreement with the American fund Apollo Global Management, which initiated the court hearing. Apollo Global Management and Ascometal failed to reach an agreement on debt restructuring.
The French Minister of Industry said that the government will seek to find a new strategic partner for Ascometal and has already received proposals from interested companies. “The coming weeks will be devoted to processing these proposals,” said Arnaud Monteburg.
The steel industry is a sensitive issue for the French government, which was unable to prevent the closure of steel production at ArcelorMittal Florange in eastern France last year, analysts said.
Steel production in Europe fell 2 percent last year, while global steel production hit a record high.
Ascometal has 6 steel works in France with sales of 969 million euros in 2013. It specializes in special steels and steels for the automotive industry and the oil and gas sector.
Car sales in Europe are down 25 percent from pre-crisis levels.
External administration introduced at the French steel company Ascometal
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Azovpromstal® 8 March 2014 г. 12:57 |
