After the decision of the High Court of Strasbourg taken on 29 January to attribute all assets of Ascometal to Schmolz + Bickenbach, with the exception of the Ascoval steel mill, a period was granted to allow a potential buyer to propose a solution ensuring a sustainable future for this plant.
Within this context, Altifort approached the Group to subsidise its takeover bid for Ascoval to the amount of €51 million. After close examination, Vallourec communicated to the judicial administrators, in charge of the procedure, that it is not possible to accede to this request. To do so, would be contrary to the Group's interests, since Altifort would oblige Vallourec to purchase steel at prices more than 30% higher than other sources of supply, putting at risk the Group's French and European activities, which have been making considerable efforts over recent years in an extremely difficult market context. The same goes for the investment grants requested by Altifort.
In addition, review of the acquisition plan shows that the project's funding requirements have been largely undervalued and are only funded to a small extent by Altifort. The remainder of the necessary financing, which goes well beyond the amounts requested from Vallourec, was to come from hypothetical lenders and investors.
Vallourec is fully aware of the dismay of Ascoval's employees faced with the risk of plant shutdown. If this were to be the case, the Group, which has made every effort for nearly two years to promote the search for a sustainable solution for the steel mill, would mobilise again to promote their re-employment, according to the needs and opportunities of its activities installed in Hauts de France, in connection with the competent authorities.
Read the article online at: https://www.worldpipelines.com/business-news/23102018/vallourecs-position-on-the-ascoval-steel-mill-takeover-project/
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