ArcelorMittal MT has submitted a proposed divestment package to the European Commission ("EC"). The move is aimed at addressing the concerns raised by the EC during its review into the planned acquisition of Ilva S.p.A by the company.
The divestment package includes assets in Belgium, Romania, Czech Republic, Macedonia and the company's only galvanized steel plant in Italy, subject to final review and approval by the EC. Moreover, any sales will be conditional upon closure of the Ilva buyout. The EC is expected to give a final decision on the matter by May 23.
In June 2017, ArcelorMittal and its partner Marcegaglia announced that AM Investco has reached a binding agreement with the Italian government regarding the lease and obligation to purchase Ilva. The transaction details of AM Investco's plans for Ilva include a purchase price of €1.8 billion, with annual leasing costs of €180 million, which will be paid in quarterly installments.
ArcelorMittal believes that Ilva will prove to be a good investment without compromising on the strength of its balance sheet. It will provide an opportunity to expand leadership and product offering in Italy, the second-largest steel producing and consuming market in Europe.
ArcelorMittal's shares have rallied 48.2% over a year, significantly outperforming the industry
's 28.9% growth.
Zacks Rank & Other Stocks to Consider
ArcelorMittal currently sports a Zacks Rank #1 (Strong Buy).
Some other stocks worth considering in the basic materials space are Steel Dynamics, Inc. STLD , United States Steel Corporation X and CF Industries Holdings, Inc. CF , each sporting a Zacks Rank #1. You can see the complete list of today's Zacks #1 Rank stocks here .
Steel Dynamics has an expected long-term earnings growth rate of 12%. Its shares have rallied 36.2% over a year.
U.S. Steel has an expected long-term earnings growth rate of 8%. Its shares have soared 23% over the past six months.
CF Industries has an expected long-term earnings growth rate of 6%. Its shares have gained 39.6% over a year.
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Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report CF Industries Holdings, Inc. (CF): Free Stock Analysis Report Steel Dynamics, Inc. (STLD): Free Stock Analysis Report ArcelorMittal (MT): Free Stock Analysis Report United States Steel Corporation (X): Free Stock Analysis Report To read this article on Zacks.com click here. Zacks Investment Research