Former Ilva, a new 240 million loan arrives in two stages

Inevitable comes yet another state loan to keep the former Ilva on its feet. In the excise decree to be approved today in the council of ministers there is a new intervention to allow the continuity of the company's production, in the face of a divestment procedure that cannot reach its destination. There is talk of a €240 million loan in total, divided, however, into two stages: €100 million should be included today in the excise decree while a further €140 million would be decided in July.

With this EUR 240 million, the Italia government will exhaust the maximum ceiling of EUR 390 million of the rescue loan that the European Commission had authorised at the beginning of February, provided it is limited to operating costs and with an obligation to repay within six months, following talks between the Minister for Enterprise and Made in Italy (MIM) Adolfo Urso and the Commissioner for Green Transition and Competition, Teresa Ribera. In January, the government had already launched the first tranche of 149 million.

The complications of the tender for the sale of Acciaierie d'Italia's assets, and the consequent extension of the timeframe (a conclusion was expected by April), make new financing indispensable to meet the liquidity needs for works, suppliers and staff salaries. The alternative would in fact be the closure of Italy's main steel group. It was Economy Minister (Mef) Giancarlo Giorgetti, during the Festival dell'Economia in Trento, who explained that the intervention to guarantee the continuation of the former Ilva's activities will find space in the decree with which the cut in excise duties on fuels will be extended. The Mef's intention to split the funding into two parts suggests, among other things, that the tender is unlikely to close before July.

The game, after all, has become increasingly complicated. Officially there are only two players in the field: the Indians of Jindal and the US fund Flacks Group. Jindal is now proposing to lease the company branch in the first phase, pending the fulfilment of a series of conditions required, starting with the issue of the Integrated Environmental Authorisation. The crux in this case is how to define the obligation to transform the lease into a purchase within, one assumes, one year. Flacks appears to be further behind in the race: it is still not convincing the government because it lacks letters of patronage from banks and, indeed, the group is asking the state for a 500 million vendor loan.

In short, the conditions are not yet in place to close the tender, not least because in the meantime it seems that the Prime Minister's Office has decided to explore other avenues. Government sources confirm that there are high-level conversations with the Arvedi group, also to assess the possibility of building an alliance with Qatar Steel and an international fund. The conversations have not yet materialised into an offer, and according to some, a new consortium could come forward, on more favourable terms, if the current tender closes without an award. A fortnight ago, however, during question time in the Chamber of Deputies, Urso outlined another path. Citing the rules of the tender, the minister spoke of other parties who are showing interest and who 'may at any time submit an offer, provided that it is better than those already received'.