By Inti Landauro
PARIS--Steel maker ArcelorMittal (MT) Monday announced it will
definitely close the two already idle blast furnaces it owns in
Florange in eastern France, as pressure continues to grow on
President Francois Hollande to act against rising unemployment.
Company officials had a meeting scheduled with union leaders on
Monday morning to announce recent decisions about the future of the
steel mill. They announced the closure of the furnaces, said Yves
Fabri, the general secretary of CGT union at the Florange mill in a
telephone interview.
The closure will make 600 workers redundant, Mr. Fabri added.
"They are relocating the steel production in other continents," he
said.
Since taking office in May, the Hollande administration has
faced a string of high-profile factory closures and massive layoff
plans at companies such as car maker Peugeot Citroen SA (UG.FR) and
pharmaceutical firm Sanofi (SAN.FR). The jobless rate in the
country surpassed 3 million in August, a level not seen in more
than a decade. French Industry Minister Arnaud Montebourg said the
government would act to prevent profitable companies from laying
off people.
Ahead of the ArcelorMittal announcement, Mr. Montebourg said he
would pressure the company into selling the furnaces to a
competitor. Mr. Fabri said he doesn't see a takeover by another
steel maker very likely.
The Luxembourg-based company made the two furnaces idle more
than a year ago but has continued to operate other facilities at
the plant including tits hot and cold rolling mills, a coke plant
and coating lines.
European steel makers are suffering from falling prices and weak
steel demand. Companies had initially expected demand to pick up in
the second quarter but users have been cautious about buying more
steel as worries that the European sovereign debt crisis will take
its toll on the European Union's economy, negatively impacting
demand for automobiles and infrastructure in the construction
sector.
Write to Inti Landauro at inti.landauro@dowjones.com
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