By Alex MacDonald
The chairman and chief executive of steel company ArcelorMittal
(MT) will meet French President Francois Hollande Tuesday after
France's industry minister said the Mittal family was no longer
welcome in France, a person familiar with the matter said
Monday.
Arnaud Montebourg said in French newspaper Les Echos Monday that
"we don't want Mittal in France any more because they didn't
respect France" and commitments made to the country since its
purchase of French steelmaker Arcelor in 2006.
A person close to the Mittal family said the family was
"extremely shocked" by the comments and said Lakshmi Mittal is due
to meet Mr. Hollande to discuss the situation at the Florange steel
plant in northeastern France.
The comments came after Mr. Montebourg said the government may
temporarily nationalize the Florange steel plant because
ArcelorMittal had refused the minister's demand for the steelmaker
to put the entire plant up for sale rather than just the two blast
furnaces that the company says are no longer economically
viable.
The remarks risk raising tensions between French industry and
the government as Mr. Hollande seeks to fulfil his campaign promise
of reviving the French economy and creating jobs.
A streak of layoffs at some of the country's largest companies,
including car maker PSA Peugeot Citroen SA (UG.FR), have put Mr.
Hollande on the spot. Peugeot has announced the closure of a large
car factory on the outskirts of Paris and the reduction of 8,000
jobs this year, while Faurecia SA (EO.FR), a car parts maker owned
by Peugeot, said this month it will cut 3,000 jobs by the end of
next year.
ArcelorMittal gave the French government until Dec. 1 to find a
buyer for two blast furnaces at Florange before taking steps to
shut them down. ArcelorMittal had temporarily idled the two
furnaces months before, saying the move was due to structural steel
overcapacity in the industry and anemic steel demand, which remains
28% below the levels seen prior to the financial crisis of
2008.
"The problem with Florange's blast furnaces aren't the blast
furnaces at Florange, it's Mittal," Mr. Montebourg said in an
interview with Les Echos. Mr. Montebourg said there were two offers
for the whole plant if ArcelorMittal were to sell the whole plant
rather than just the two furnaces.
ArcelorMittal, which said it hasn't seen any offers, turned down
the request on grounds that the sale of the entire plant would
"would jeopardise the viability of the rest of Arcelormittal's
operations in France, which employ 20,000 people." The closure of
the two blast furnaces is expected affect 600 jobs.
Mittal Steel Ltd. merged with France's Arcelor SA about six
years ago to create the world's largest steelmaker by production
capacity, accounting for 6% of global steel production as of last
year.
--Inti Landauro in Paris contributed to this story.
Write to Alex MacDonald at alex.macdonald@dowjones.com
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