Global steel giant ArcelorMittal has hived off its stainless and speciality steels business into Aperam, a newly created company, in a bid to unlock value for shareholders.
“The Extraordinary General Meeting of shareholders of ArcelorMittal held in Luxembourg approved ... the spin-off of ArcelorMittal’s stainless and speciality steels business into Aperam, a newly created company,” the company said after the EGM meeting.
The spin-off was approved by the shareholders at the EGM on January 25 by an overwhelming majority, the company said, adding that “963,117,270 shares, or 61.7 per cent of the company’s share capital, were present or represented at the meeting.”
Earlier last month, the firm had announced the spin-off in its stainless division to unlock value for shareholders. Under the plan, the company decided to allot its shareholders one share in the stainless steel unit for every existing 20 shares in the first quarter of 2011.
Last year, the company Chairman and CEO, Mr Lakshmi Mittal, had said that the group was confident of the future of stainless business and believed that the creation of a separately focussed company will create additional value for shareholders.
The business employs around 11,000 people, which is about four per cent of ArcelorMittal’s total workforce.
The widely expected spin-off is likely to result in a non-cash impairment charge of about $800 million, while the business unit will have a net debt of about $1 billion.
It will comprise a combination of existing ArcelorMittal debt that will be transferred, besides new loans raised by this business, the company had said, adding that it planned to list the stainless steel shares on Euronext Paris, Amsterdam and in Luxembourg.
In the United States, they will trade on over-the-counter market in the form of NY Registry Shares.
The stainless steel division’s 2009 sales were reported at $4.2 billion. In September, the company had appointed the Group’s head for Human Resources, Mr Bernard Fontana, as the Chief Executive of its stainless division.
The global steel major, which is focusing on expanding mining operations, has presence in more than 60 countries and accounts for over 70 million tonnes of crude steel production, representing about eight per cent of the world’s steel output.