Currently, these intentions are being evaluated by the EU antimonopoly authority

Marcegaglia plans to acquire the Latvian company Severstal Distribution SIA from the Russian steel company Severstal, reports Kallanish.

Currently, these plans are being considered by the EU antimonopoly body – the General Directorate of the European Commission for Competition. The decision will be made by April 19.

With the acquisition of Severstal Distribution SIA, the subsidiary company of the Italian stainless steel producer Marcegaglia Carbon Steel will gain full control over the service center in Riga, as well as its subsidiaries Severstal Distribution Sp.z.o.o. in Poland and Severstal Distribution LLC in Ukraine.

The units operate a supply chain that includes only the distribution of flat and long products, without any manufacturing activity, the EU antitrust authority, which is evaluating the deal, said in a statement.

European sanctions against the Russian Federation due to the war in Ukraine made it difficult for Severstal to support its European subsidiary. In particular, a year ago, the Russian company announced its desire to preserve the work of the Latvian division, but only for two months due to EU sanctions against the majority shareholder of Severstal. The division’s revenue in 2021 amounted to €1.53 billion.

Last December it was reported that Marcegaglia buys a division for the production of long stainless steel products and the melting shop of the British company Outokumpu. Due to the purchase of capacities in the UK, the Italian company expects to provide rolled steel to European enterprises and to bypass protective measures, anti-dumping duties, as well as CBAM, which are in force in the EU. Outokumpu expected to complete the sale in early 2023.

In December 2019, Marcegaglia bought the thick sheet steel plant Palini&Bertoli in Italy, which belonged to the Russian steel group Evraz for €40 million.

As GMK Center reported earlier, the Russian steel plant Severstal lost more than $400 million due to the effect of Western sanctions. Severstal and its main owner Oleksiy Mordashov are under USA sanctions since June 2022, and the chairman of the company’s board of directors was added to the EU sanctions list in the spring.