Mittal's SAfrican steel company seeks new CEO
ArcelorMittal SA, the embattled South African subsidiary in the global portfolio of steel magnate Lakshmi Mittal, has been seeking its fourth chief executive after its current CEO Wim de Klerk announced his retirement.
Despite having an 80 per cent market share in the local steel market, the AMSA has battled against cheaper imports from China and falling global steel prices.
Even a government intervention introducing a 10 per cent tariff on imported steel in the face of huge job cuts after Mittal met leaders personally has not helped resolve the crisis facing the company.
The AMSA last made a profit in 2011 of less than a million dollars, with cumulative losses since then sitting at more than a billion dollars.
The AMSA's share price has fallen 98 per cent since its peak in 1998, when the company was formed after Mittal bought out the ailing state-owned steelmaker Iscor.
Mittal had initially been brought in to rescue Iscor by introducing the expertise he had developed elsewhere, successfully turning the company around.
At the time of his appointment in September 2016, De Klerk was lauded for having the experience to turn around AMSA failing fortunes, but analysts expressed concern that any incoming chief executive would face the same challenges that De Klerk was brought in to resolve.
Peter Major, an analyst at Cadiz Corporate Solutions, was quoted as saying by the Sunday Times that De Klerk's departure was "devastating" in the face of South Africa s mining industry, which had little prospect of recovery.
Paulo Trinchero, CEO of the Southern African Institute of Steel Construction, told the weekly that the market was shrinking, and the costs were going up.
"The costs for AMSA in the past five years have gone up drastically. Even some of the interventions by government, such as reducing imports, have come a bit too late in the day," Trinchero said.
But in a short statement Lakshmi Mittal dismissed concerns that there would be huge retrenchments soon at AMSA.
"ArcelorMittal remains fully committed to the South African business, which is integral in our strategy for the African continent," Mittal said.
(This article has not been edited by Zeebiz editorial team and is auto-generated from an agency feed.)
Get Latest Business News, Stock Market Updates and Videos; Check your tax outgo through Income Tax Calculator and save money through our Personal Finance coverage. Check Business Breaking News Live on Zee Business Twitter and Facebook. Subscribe on YouTube.