Mittal Steel South Africa has bought two steel mills in Mozambique to grow its sub-Saharan presence, the company said on Friday.
The $11,45-million purchase was the first Mittal had made out of South Africa. It formed part of a memorandum of cooperation that the company was finalising with the Mozambican government.
CEO of Mittal, Rick Reato, said the acquisition of the two mills marked a milestone in the company’s history.
”Investment expansion into sub-Saharan Africa, and specifically Mozambique, forms a fundamental part of our expansion strategy. We have over the years informed the markets that we will, when the time and asset is appropriate, make acquisitions outside of our borders. We are extremely pleased that this acquisition in Mozambique could be our first.”
It would buy the plant and equipment of the Companhia Siderugica De Mozambique (CSM) and Companhia Mozambique De Trefiloria (Trefil) from the Mozambican government.
CSM was a rod mill and Trefil a wire drawing facility. Mittal planned to increase production of these mothballed assets within two years to 72 000 tons and 32 000 tons per annum respectively.
As part of the memorandum of cooperation with the Mozambican government, Mittal and Mozambique would cooperate in the development of the country’s steel industry and mining sector.
Mittal is Africa’s largest steel maker, producing 7,2-million tons of liquid steel per annum. The company employs about 9 000 people in South Africa. — Sapa