) announced that it has signed a strategic agreement with
Algerian company Sider. The deal includes an investment plan of
$763 million for the steel complex at Annaba and mines in Ouenza
and Boukhadra. It also includes plans of selling part of the
company's stake in two steel joint ventures in Annaba and Tebessa
to state-owned Sider.
Per the agreement, ArcelorMittal will reduce its stake in both
ArcelorMittal Annaba and ArcelorMittal Tebessa to 49%, with the
state of Algeria owning the remaining 51%. ArcelorMittal's
investment project plan includes more than doubling the Annaba
steel plant's annual production capacity from 1 million ton to
2.2 million tons by 2017. The company stated that the plan will
be funded by equity contributions from shareholders and bank
ArcelorMittal plans to build a rolling mill for rebar and wire
rod with a production capacity of 1 million tons. Also, the
investment will ensure a long term future for steel making in
Annaba and mining in Tebessa. Through this investment,
ArcelorMittal Annaba will be able to cater to the increased
domestic demand for steel products in Algeria and support the
government to become self sufficient in steel.
ArcelorMittal, the world's largest steel maker, released its
second-quarter 2013 results in August. The company posted a net
loss of $0.8 billion or 44 cents per share in the quarter
compared with a net income of $1 billion or 66 cents per share a
year ago. Barring one-time items (restructuring and impairment
charges), loss was 32 cents per share. Analysts polled by Zacks
were expecting earnings of 9 cents a share on average for the
quarter. The results were impacted by lower pricing and weak
Revenues declined 10.1% year over year to $20.2 billion in the
reported quarter and missed the Zacks Consensus Estimate of $20.7
billion. Sales increased 2.3% on a sequential basis due to higher
steel shipment volumes. Shipments declined 1.8% year over year to
21.3 million metric tons in the quarter.
ArcelorMittal currently maintains a Zacks Rank #3 (Hold).
Other companies in the steel industry with favorable Zacks
Companhia Siderurgica Nacional
Shiloh Industries Inc.
Kobe Steel Ltd.
). While Companhia Siderurgica and Shiloh Industries maintain a
Zacks Rank #1 (Strong Buy), Kobe Steel holds Zacks Rank #2
KOBE STEEL-ADR (KBSTY): Get Free Report
ARCELOR MITTAL (MT): Free Stock Analysis
SHILOH INDS INC (SHLO): Get Free Report
CIA SIDERUR-ADR (SID): Free Stock Analysis
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