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ArcelorMittal (NYSE:MT) said Tuesday it has decided against shutting its Newcastle steel plant in South Africa and is working on a plan to make it viable, more than six months after announcing its closure.
The plant in KwaZulu-Natal province makes fencing material, rail, rods and bars used in sectors such as construction, mining and manufacturing.
The company said it has obtained a 1B rand (~$54M) working capital facility to support continued operations, and said the non-renewal of a steel scrap export ban after it expired in December had started to bring "greater fairness and equity into the input cost structures" between integrated steelmakers such as ArcelorMittal (MT) and scrap-based producers.
Although its long steel operations were stable during the six months to June 30, ArcelorMittal (MT) said it expects its losses will widen to a headline loss of 0.96-1.04 rand/share for the half-year, compared with a headline loss of 0.40 rand/share during the same period last year.