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Editor in chief: Angelo Scorza
06/11/17 09:58

Alcoa: money is available, but the agreement was not signed yet

Swiss bidder SiderAlloys allocated some 100 million Euro to revamp the Portovesme plant, but decisive details are still to be agreed, while Glencore is waiting for its chance

The sales agreement related to Alcoa's Portovesme (Carbonia Iglesias) plant has not been signed yet because, even though the necessary budget to restart the alumina extraction plant was established, SiderAlloys' offer was not regarded as completely satisfactory by the Italian Government.

The latter is conducting negotiations through Invitalia, the agency for inward investments promotion and business development mediating between the American multinational company and potential purchasers. Therefore, before signing the sales agreement with the Lugano-based company, there are still several decisive details to be agreed upon.

The parties did not specify whether it is only a question of bureaucratic issues, or of essential conditions, but the deadline within which metals and ferro-alloys trader SiderAlloys should have signed the agreement was deferred to a later date, and said postponement was agreed upon by the Minister of Economic Development.

Negotiations between USA and Switzerland had started in September 2016 with the formal purchase proposal for the Sardinia smelter, with October the 31st as the deadline to grant exclusive negotiations to the Swiss company.

After a 5-years wait, workers are hoping for a positive outcome, as pointed out in Carbonia during their recent meeting, when they decided to organise a protest in the event that Minister of Development Carlo Calenda's call should not be issued.

The good news is that the company headed by CEO Giuseppe Mannina – who during a meeting with President of the Sardinia Region Francesco Pigliaru, held last month, declared to be waiting for a more detailed technical assessment of the plant – finally submitted their final expression of interest, including the industrial and financial plan, allocating some 100 million Euro to revamp the Sulcis Iglesiente plant. As a matter of fact, the agreement provides for a 128 million investment, 30 of which resulting from own resources.

If the deal is carried out, the Swiss company will restart production in the Sardinia plant within 14 months, aiming at covering 15% of Italian needs (in the first phase), hiring 40 direct workers and 40 indirect workers, up to 300 actual workers, with plant implementation within 30 months.

This would put an end to a significant issue for most Sardinia. In November 2012, the world's third  aluminium producer Alcoa Inc. (Aluminium Company of America), working in 44 countries and   operating in Italy since 1967 (with its representative and commercial office in Milan), announced the final shutdown of the Portovesme factory within its global restructuring plan – officially due to “high production costs and limited competitiveness perspectives for the plant” - that it had taken over from the Italian government in 1996, and that produced 155,000 tons of primary aluminium in ingots and billets, before shutting down on August the 25th 2014.

Confidence in former Sardinia-based Alcoa's revival relies also on the procedure underway related to the 2017 European draft law approved on October the 25th by the Chamber EU Policies committee, that on November the 6th will be examined by the Chamber of Deputies before its final implementation. The draft law includes provisions concerning energy-consuming companies and savings for other energy consumers.

For what concerns employment, social security benefits for the 400 direct workers and the 300 indirect ones will expire on November the 30th, but trade unions already declared that they are going to ask for the benefits to be granted also in 2018.

Meanwhile, another Swiss company is waiting for possible negative outcomes. In fact, trading giant Glencore is thought to have shown its interest at the end of last August. The multinational company with registered office in Baar (Canton of Zug) is already working in Sardinia since the end of the last century as in July 1999 it took over lead and zinc producer Portovesme Srl from ENI.

Angelo Scorza


TAG : Trading