(Bloomberg) — ArcelorMittal SA dropped its planned takeover of a joint venture with struggling carpart manufacturer CLN-Coils Lamiere Nastri SpA after the Italian government-imposed restrictions, paving the way for a domestic rival to take control.
The steel conglomerate had originally agreed to take control of the 51% stake of CLN Distribuzione Italia Srl it didn’t own as part of a broader debt restructuring agreement reached between CLN and its lenders.
The , however, used its so-called golden power — aimed at protecting strategically relevant companies — to impose conditions on takeovers. These included government approval for reductions in the company structure and workforce, and maintaining existing operations for five years, according to people familiar with the matter, who asked not to be named because they aren’t authorized to speak publicly.
ArcelorMittal decided not to proceed with the deal and Acciaieria Arvedi SpA, an Italian steelmaker which had bid for the joint venture earlier in the process, made a new binding proposal, the people said. ArcelorMittal and CLN agreed to the offer in recent weeks, with planning to increase production, they said.
Representatives for Arvedi, CLN and the industry ministry declined to comment. An official at ArcelorMittal didn’t reply to requests for comment.
The intervention in the ArcelorMittal-CLN joint venture is the latest example of how the Italian government is using its golden power rules to support national interests against perceived threats and protect domestic companies and jobs. Meloni’s government effectively derailed UniCredit SpA’s bid for Banco BPM SpA, the country’s third-largest lender, and has also used the powers to force changes at Pirelli SpA, curbing the influence of its largest shareholder.
The formation of the ArcelorMittal-CLN joint venture in 2015 brought together two of the largest steel distributors for flat carbon steel products. is also one of the largest creditors of the company, ahead of banks and other suppliers. The joint venture employs about 400 people, with €801 million ($933 million) revenue reported in 2022, according to its website.
Caught up in the decline of the auto industry, CLN is separately pushing ahead with an asset disposal plan to allow banks recover part of their original exposure to the business.
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