associate sponsors

Llyod
HDFC

Slowdown forces ArcelorMittal to write down European biz value by $4.3 bn

Luxembourg/ New Delhi: World's largest steel maker ArcelorMittal today said it will write down the value of its European business by about $4.3 billion on account of decreasing demand in Europe due to weaker macro economic and market environment.

"The write down will take the form of a non-cash impairment charge that will be recorded in the fourth quarter of 2012. The impairment is due to a weaker macro economic and market environment in Europe where apparent steel demand has fallen by approximately 8 percent this year, bringing the cumulative demand decline to 29 percent since 2007," the company said in a statement.

The company said its key metrics such as net debt and operating profits, as well as compliance with debt covenants, are unaffected by this impairment. Reuters

The development comes on heels of the company closing its blast furnaces in France and Belgium. "This weaker demand environment, and expectations that it will persist over the near and medium term, led to a downward revision of cash flow expectations underlying the valuation of the European businesses to which goodwill has been allocated," the company said.

This is in contrast to the US, where apparent steel consumption is up almost 8 percent this year and is now approximately 10 percent lower than it was in 2007, it added.

The company said its key metrics such as net debt and operating profits, as well as compliance with debt covenants, are unaffected by this impairment.

Europe's steel industry is struggling with excess production capacity amid economic downturn.

PTI


Updated Date: Dec 20, 2014 15:19 PM

Also Watch

Watch: The true stories from Dharavi that inspired Rajinikanth's Kaala
  • Thursday, March 8, 2018 Watch: Cyrus Khan talks about Parkour, jumping across walls and why he hates sitting
  • Thursday, May 31, 2018 Unwind: India's basketball sensation Amjyot Singh has his eyes set on becoming an NBA regular
  • Monday, May 28, 2018 First Day First Showsha — Review of Solo: A Star Wars Story in 10 questions
  • Saturday, May 19, 2018 Social Media Star: Rajkummar Rao and Bhuvan Bam open up about selfie culture, online trolls


{if $hideJSforEU != 'yes'} {/if}