Vallourec has started exclusive negotiations with Ascometal with a view to the sale of its majority holding in the Saint-Saulve steel mill (Hauts-de-France region).
Negotiations are expected to conclude with a final agreement being signed by the end of 2016.
At this stage in proceedings, the two partners envisage creating a joint venture with Vallourec holding a 40% stake and Ascometal having a 60% holding, thus giving the latter exclusive control of operations.
From an industrial viewpoint, the two shareholders will be supplied by the Saint-Saulve modern and high technology steel mill, Vallourec for its requirements in terms of special steels and Ascometal to supply its finishing units located in Dunkirk and Fos-sur-Mer, in the North and South of France.
The global industrial projects would include a significant investment programme in order to diversify production at the Saint-Saulve steel mill and meet Ascometal's new requirements.
This would include:
- In Saint-Saulve, the upgrade of the existing equipment in order to produce steel bars with varying diameters, which would pave the way to accessing new markets, in particular in the automotive industry.
- In Dunkirk, new rolling capacity that would enable this plant to gain a foothold in new automotive markets.
- In Fos-sur-Mer, new equipment that would enable the rod mill to use the semi-finished products made with the Saint-Saulve continuous casting, in addition to the semi-finished products from the Fos ingot casting, in order to allow this plant to enter new bearings markets.
At the outset, the undertakings made by the two parties in terms of the quantities of steel produced are as follows: 175 000 tpy for Ascometal, and 100 000 tpy for Vallourec. These volumes would secure the steel mill's long-term operations and competitiveness.
Management and employee representatives were informed today about this stage of the process of the partial sale of the steel mill.
Edited from press release by Angharad Lock
Read the article online at: https://www.worldpipelines.com/business-news/22072016/vallourec-starts-exclusive-negotiations-with-the-ascometal-group-349/