ArcelorMittal

European economy 16th January 2024

ArcelorMittal could sell 40% stake in Acciaierie d’Italia, and potentially increase buybacks programme and reduce leverage

Morgan Stanley | Alain Gabriel highlights the news published by La Republicca that ArcelorMittal would be looking to sell its 40% stake in Acciaierie d’Italia (ADI), which has been underperforming (<4mta vs ~10mta). ADI’s earnings are not reported under Arcelor’s EBITDA, but under those of the Associates and JVs. Alain Gabriel estimates that EBIDA attributable to ADI was US$170mn in 2022. The article reported that Arcelor wanted to sell its…

World economy 22nd October 2023

ArcelorMittal to supply steel to alliance of several oil companies to develop two clean hydrogen hubs in USA

Link Securities| Two consortiums participated by ArcelorMittal and EDP Renovables have been awarded €2 billion for the development of two clean hydrogen hubs in the USA. The steelmaker and its partners will receive €950 million in government aid, while the alliance in which the renewable energy company has a stake will receive more than €1.1 billion. The MTS consortium, called the Midwest Clean Hydrogen Alliance (MachH2), includes other oil industry…

Companies, Relevant News Item 18th August 2023

Potential $7.8bn bid for US Steel would take 27% of ArcelorMittal’s EV and raise debt to ~0.8x DFN/Ebitda

Banc Sabadell | According to press reports, ArcelorMittal (MTS) is considering a bid for US Steel, although there is no certainty at this stage that the deal will go ahead. US Steel on Sunday rejected an offer from Cleveland-Cliffs that values the company at around $7.3 billion (~€6.7 billion) and represents a 43% premium on its share price. Also US steelmaker Esmark reportedly launched an offer of $7.8 billion (~€7.15…

Spanish economy 23rd January 2023

ArcelorMittal achieves €450 million subsidy to decarbonise plants in Asturias

ArcelorMittal will receive direct aid of around €450 million for the transformation of its facilities in Asturias. The European Commission gave its authorization last Friday for the Spanish Government to grant the steel giant the subsidy, which is part of the Perte (Strategic Project for Economic Recovery and Transformation) of industrial decarbonisation, which the Government approved on December 27 and endowed with €3,100 million of public funds. The Council of…

Companies, Ibex, Relevant News Item 28th December 2022

Arcelor, biggest opportunity for a rerating and biggest “mispricing” (Overweight)

Morgan Stanley | China’s reopening trade and the support for its property market has sparked a strong rally in the steel sector and in underlying commodities, leading the stocks to already discount a recovery in demand during 2023. Now there is an <8% average upside to target prices, so the risk/return is not attractive. The base scenario assumes a recovery in China in Q2’23. However the road will be bumpy,…

Companies, European economy, Ibex 14th November 2022

Problems related to demand worsen for ArcelorMittal due to a persistent de-stocking in Europe

Morgan Stanley | Arcelor’s conference call focused on the outlook for the business, on Q4 results, on the dynamics of the working capital and returns on capital. Our economist Alain Gabriel highlights the following issues: The problems surrounding demand are worsening due to a persistent de-stocking in Europe, which Alain expects to further exacerbate in Q4.EBITDA 4Q: fewer deliveries and lower prices are offset (partly) by lower variable costs. Energy coverage…

Companies, European economy, Ibex 7th July 2022

We still prefer carbon steel vs stainless steel; ArcelorMittal (Overweight) and Acerinox (Equalweight)

Morgan Stanley | The steel companies have historically done badly in recessions. Currently, with the risks of recession on the rise, margins at spot price continue to weaken and we have seen an important derating. It is likely that delays in prices support Q2 profits, but we see a significant slowdown from the next quarter. We still prefer carbon steel to stainless steel. ArcelorMittal (OW): we expect the company to generate…

Ibex, Markets 12th May 2020

ArcelorMittal Will Hike Capital To Recover “Investment Grade” Status

After Moody’s downgraded ArcelorMittal’s debt rating by one notch yesterday, causing it to lose its “investment grade” status, the company has proposed a $2 billion capital increase via shares and mandatory convertible bonds. It will decide what proportion is covered by each of the two offers. Furthermore, it reserves the right, depending on demand, to increase the amount of $2 billion.

Ibex 30th September 2019

Demand for steel is not recovering, but ArcelorMittal is doing its homework

Banc Sabadell | The demand for steel in Europe (40% EBITDA) is somewhat weaker than expected (the expected recovery in car making has not happened), which means price rises are not expected. However, ArcelorMittal has showed that it is doing its homework in reducing cash outflows, given a tight financial situation, which could lead to announcements of improved shareholder remuneration in 2020.

Ibex 20th June 2019

ArcelorMittal: lower profits complicate re-rating

The latest profit warning from Nucor for Q2 (1.20-1.25% vs consensus 1.48$) seems to confirm the weakening of tendencies in the steel sector in this period.

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