By Eric J. Lyman
ROME, June 25 (Xinhua) -- A recent deal to allow a group headed by Luxembourg steel giant ArcelorMittal to take over troubled Italian steel maker Ilva is aiming to preserve jobs but it does too little to address environmental concerns, commentators said.
The winning AM Investco Consortium also includes participation from Italian steel processor Marcegaglia and Bank of Intesa Sanpaolo, and its 1.8 billion-euro (2.0-billion U.S. dollar) bid was picked over a rival bid from JSW Steel from India.
According to Stefano Ciafani, director general with the Italy's largest environmental group, Legambiente, the main difference between the two bids was that the AM Investco Consortium offered more guarantees for preserving jobs, while the JSW Steel was stronger on environmental issues.
"The Indian bid would have shifted to natural gas rather than coal for the bid that won," Ciafani said in an interview. "The winning bid does too little to address the environmental worries and it does what it does too slowly."
AM Investco Consortium did agree to spent at least 2.4 billion euros (2.7 billion U.S. dollars) to modernize the plant and improve its impact on the environment. But that might not be enough, given Ilva's long and difficult history.
Ilva is Europe's largest single steel smelter in terms of capacity, and it has been the subject of major environmental concerns for more than a decade, dating back to when it was responsible for more than 90 percent of the Italian production of the pollutant dioxin and nearly a tenth of the dioxin production for the European Union as a whole.
The plant has also had a negative impact on air and water quality in the region of Pulia, where the plant is based, while also producing excessive levels of greenhouse gas emissions.
The plant has been temporarily shuttered on multiple occasions and it has paid millions in fines tied to environmental and health abuses.
In city of Taranto, where the plant is based, prosecutors have alleged that nearly 12,000 deaths can be traced to toxic emissions from Ilva over a seven-year span.
"The plant has been Italy's single largest environmental problem for many years," Ciafani said.
Two years ago, the Italian government took a controlling stake in the company to help speed up the environmental cleanup while preserving jobs for most of the plant's 14,000-member workforce.
According to Franco Milanese, a business law professor at the University of Naples, saving jobs has probably always been the top priority in the government's strategies for Ilva.
"If there weren't thousands of jobs at stake, Ilva would have been closed many years ago," Milanese told Xinhua.
In its offer, the AM Investco Consortium guaranteed to preserve "at least 10,000 jobs" at Ilva through the entire modernization plan for the plant. Italy said it would help employ some laid off workers in initiatives to clean up the plant.
In a statement, Lakshmi Mittal, chairman and chief executive officer for ArcelorMittal, said the takeover plan would, "enable the company to improve its product mix, win back market share, and address the environmental issues."
The Ilva deal is part of a wider trend for consolidation in the European steel industry, including talks between India's Tata Steel and German conglomerate ThyssenKrupp to merge their European steel operations.
