JSW Steel will soon put its subsidiary in Italy on the block on as many efforts by the company to revive the business have failed amid rising raw material cost and pressure mounting to make fresh investment to cut emission.
JSW Steel had acquired the once prized and second largest steel plant at Aferpi for €55 million (₹451 crore) from Algeria-headquartered Cevital in 2018. Having lost the battle with ArcelorMittal then for acquiring a steel plant Ilva SpA, JSW Steel was then very bullish about revival of the stressed Aferpi.
However, the plant could not be turned around despite huge investment to upgrade it and cut-down on cost. The Russian invasion of Ukraine has made matters worse by pushing up the cost all around, sources said.
When contracted, JSW Steel declined to comment.
Originally owned by Russia’s Severstal, Aferpi has an annual steel production capacity of about two million tonnes in Piombino and manufactures speciality steel used in railway, automobile and earth-moving vehicles, among others.
The Italian unit has reported an EBITDA loss of euro 6.8 million in December quarter against EBITDA of euro 6.1 million in September quarter due to certain one-time write-offs and impairment charges.