France reaches €180m deal on Mittal steel plant

Firm run by Britain’s wealthiest man agrees to drop plans for 650 redundancies at site

Paris

The clash of steel between the French government and Britain’s wealthiest man ended with a partial victory for Paris last night.

ArcelorMittal, the world’s largest steel company, agreed to invest €180m (£146m) over five years and cancel plans for 650 redundancies at its steelworks in Florange, in the eastern region of Lorraine. In return, Paris abandoned a threat to nationalise the factory and re-sell it to a private buyer.

The showdown had become symbolic of President François Hollande’s determination to reverse the erosion of France’s industrial base. The government was forced to accept, however, that two shuttered blast furnaces would not re-open immediately.

Instead, ArcelorMittal, controlled by the Indian-born, British-based billionaire Lakshmi Mittal, will develop other profitable activites at the site, such as the production of steel plate for the German car industry. Three hours before last night’s deadline for a deal, Prime Minister Jean-Marc Ayrault said a compromise had been reached. Jobs would be preserved, he said, by a “programme of investment” in cold steel activities. The blast furnaces, which produce “raw” or hot steel, would not re-open but be mothballed until they could be converted to possible experimental use in environment-friendly steel-making. There would be no compulsory redundancies, he insisted. In return for the “unconditional promises” by ArcelorMittal, Mr Ayrault said Paris had dropped its threat to nationalise the complex and sell it within a matter of months for €400m to an undisclosed potential buyer.

The nationalisation threat caused a stir internationally. Foreign commentators, including the London Mayor Boris Johnson, mocked France for returning to the statist 1970s or even the revolutionary 1790s.

The outcome of the talks will be seen as a vindication of the tough line taken by Mr Hollande and his Industry minister Arnaud Montebourg, who had suggested the Mittal group was no longer welcome in France.

However, the deal received only a cautious welcome from politicians  and unions. The Socialist mayor of Florange, Philippe Traillon, said the deal was “fine in principle” but demanded guarantees that Arcelor would keep its word. Unions accuse the firm of breaking previous commitments.

Start your day with The Independent, sign up for daily news emails
PROMOTED VIDEO
ebooks
ebooksA year of political gossip, levity and intrigue from the sharpest pen in Westminster
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs General

Recruitment Genius: Account Manager

£20000 - £35000 per annum: Recruitment Genius: This full service social media ...

Recruitment Genius: Data Analyst - Online Marketing

£24000 - £35000 per annum: Recruitment Genius: We are 'Changemakers in retail'...

Austen Lloyd: Senior Residential Conveyancer

Very Competitive: Austen Lloyd: Senior Conveyancer - South West We are see...

Austen Lloyd: Residential / Commercial Property Solicitor

Excellent Salary: Austen Lloyd: DORSET MARKET TOWN - SENIOR PROPERTY SOLICITOR...

Day In a Page

Isis in Iraq: Yazidi girls killing themselves to escape rape and imprisonment by militants

'Jilan killed herself in the bathroom. She cut her wrists and hanged herself'

Yazidi girls killing themselves to escape rape and imprisonment
Ed Balls interview: 'If I think about the deficit when I'm playing the piano, it all goes wrong'

Ed Balls interview

'If I think about the deficit when I'm playing the piano, it all goes wrong'
He's behind you, dude!

US stars in UK panto

From David Hasselhoff to Jerry Hall
Grace Dent's Christmas Quiz: What are you – a festive curmudgeon or top of the tree?

Grace Dent's Christmas Quiz

What are you – a festive curmudgeon or top of the tree?
Nasa planning to build cloud cities in airships above Venus

Nasa planning to build cloud cities in airships above Venus

Planet’s surface is inhospitable to humans but 30 miles above it is almost perfect
Surrounded by high-rise flats is a little house filled with Lebanon’s history - clocks, rifles, frogmen’s uniforms and colonial helmets

Clocks, rifles, swords, frogmen’s uniforms

Surrounded by high-rise flats is a little house filled with Lebanon’s history
Return to Gaza: Four months on, the wounds left by Israel's bombardment have not yet healed

Four months after the bombardment, Gaza’s wounds are yet to heal

Kim Sengupta is reunited with a man whose plight mirrors the suffering of the Palestinian people
Gastric surgery: Is it really the answer to the UK's obesity epidemic?

Is gastric surgery really the answer to the UK's obesity epidemic?

Critics argue that it’s crazy to operate on healthy people just to stop them eating
Homeless Veterans appeal: Christmas charity auction Part 2 - now LIVE

Homeless Veterans appeal: Christmas charity auction

Bid on original art, or trips of a lifetime to Africa or the 'Corrie' set, and help Homeless Veterans
Pantomime rings the changes to welcome autistic theatre-goers

Autism-friendly theatre

Pantomime leads the pack in quest to welcome all
The week Hollywood got scared and had to grow up a bit

The week Hollywood got scared and had to grow up a bit

Sony suffered a chorus of disapproval after it withdrew 'The Interview', but it's not too late for it to take a stand, says Joan Smith
From Widow Twankey to Mother Goose, how do the men who play panto dames get themselves ready for the performance of a lifetime?

Panto dames: before and after

From Widow Twankey to Mother Goose, how do the men who play panto dames get themselves ready for the performance of a lifetime?
Thirties murder mystery novel is surprise runaway Christmas hit

Thirties murder mystery novel is surprise runaway Christmas hit

Booksellers say readers are turning away from dark modern thrillers and back to the golden age of crime writing
Anne-Marie Huby: 'Charities deserve the best,' says founder of JustGiving

Anne-Marie Huby: 'Charities deserve the best'

Ten million of us have used the JustGiving website to donate to good causes. Its co-founder says that being dynamic is as important as being kind
The botanist who hunts for giant trees at Kew Gardens

The man who hunts giants

A Kew Gardens botanist has found 25 new large tree species - and he's sure there are more out there