ArcelorMittal SA warns early steps needed to wind down Longs business

On March 31 Amsa said that it had received a R1.68 billion funding facility from the IDC

- EDWARD WEST

ARCELORMITTAL South Africa (Amsa), which continues to pay heavy prices for government infrastructure and policy failures, may be left with no option but to prepare for the wind down process of its Longs Business, well in advance of September 30, 2025.

This announcement, and despite a forecast of slightly reduced headline earnings losses for the six months to June 30, caused the share price to slump 7.89% to 105 cents on the JSE by Monday afternoon considering that three years ago the price traded above R5 a share.

On March 31, Amsa announced its decision to wind down the Long Steel Business had been deferred for at least 6 months to September 30 after it received a R1.68 billion funding facility from the Industrial Development Corporation (IDC).

The facility was now fully drawn and would enable the Longs Business to operate through the third quarter. The business would also continue to trade until the end of September, having regard to the commitments made to its customers.

However, so far, "limited" progress was made to redress major structural issues, which was the main aim of the deferral period.

"High imports continue to flood into the domestic market. Transnet's rail performance deteriorated to its lowest levels ever, resulting in significantly elevated operating risk and unaffordable additional costs being borne by the company," Amsa's directors said.