Logan effect: Arcelor and Bamesa build 30m-euro factory

European steel giant Arcelor and Spain’s Bamesa company, yesterday announced they would invest 30 million euros in building a steel service centre in Topoloveni (Arges County) for the automotive and domestic appliance industry, by 2008.
The service centre will be 40% held by Arcelor and will be located close to the Dacia plant that makes the Logan model.
“Renault is an Arcelor customer and our policy is to follow our customers in the automotive industry, which need high quality steel products. The idea was to make deliveries to Dacia through this plant, but we are not ruling out the possibility to work with more clients. The factory will be a supplier for both the automotive and domestic appliance industries,” Jean Lasar, Arcelor spokesman told ZIARUL FINANCIAR.
“We see Eastern Europe as a market that is growing. Mittal Steel has a strong presence there, including Romania, so that we will take that into consideration, as well,” Arcelor official said. Globally, Mittal Steel has started procedures to merge with Arcelor, a move intended to create world’s biggest steel maker.
Mittal Steel has a very strong business portfolio in Romania, and is the largest foreign player on this market, second only to Austria’s OMV, Petrom’s majority shareholder.
The steel service centre could have an annual production capacity of 300,000 tonnes. Construction work has already begun on a 130,000-sqm plot of land, Arcelor officials say. The steel service centre will be up and running in the first half of 2007.
The number of employees could reach 100, industry sources estimate.
The factory will use leading-edge technology to meet customers’ requirements for sheet metal that is cut and formed to order.
“This new steel service centre will allow us, working alongside our partner Bamesa, to seize growth opportunities in Central and Eastern European markets,” said Gonzalo Urquijo, Arcelor chief financial officer and senior executive vice president in charge of Arcelor Steel Solutions and Services division.
Michel Wurth, deputy CEO in charge of Arcelor’s flat products sector, stressed the importance of this initiative as part of the group’s leadership strategy in the automotive industry. “This new steel service centre enables us to extend our relationships with existing major international customers moving into this region,” Wurth specified.
Arcelor has been present with a representative sales office on the Romanian market since 2004. Arcelor’s business in Romania amounted to 15 million euros.
Bamesa has similar steel service centres in Spain, Portugal, France and Turkey and also owns stake in companies from Mexico and Romania.
Bamesa generated EBITDA of 75 million euros in 2005 and projects 2006 sales to stand at over 1 billion euros.
Arcelor is the number one steel producer in Europe and Latin America and its products are aimed at the automotive, construction, household appliances and packaging industries.