London (Platts)--21Feb2013/902 am EST/1402 GMT
Switzerland-based industrial investment company Klesch signed a contract Wednesday to acquire some of the assets of Italian steel producer Leali, after having made a binding offer a few weeks ago, a source close to the matter told Platts Thursday. The source said Klesch has offered around Eur40 million for Leali's mini-mill at Odolo and its billet plant in Borgo Valsugana, but not for the Italian company's reinforcing bar mill in Roe Volciano. When contacted by Platts Klesch declined to comment, while Leali was not immediately reachable for comment. Last September, Leali's board asked the tribunal of Brescia to put the company under "concordato di continuita," a receivership procedure aimed at saving it from bankruptcy. With the new sale agreement, the tribunal will have to decide whether the proposals from Leali and Klesch represent a solid plan for the company's creditors. If the tribunal approves the plan, it will proceed with the admission to receivership and appointment of an administrator, which according to the Platts source would be likely within days. If approved by the tribunal, a new company would be formed to run the Borgo Valsugana and Odolo works, with production likely to restart by May. The Odolo works has a nameplate capacity of 500,000-600,000 mt/year. The source said that last year it produced around 300,000 mt of bars. Since November it has been idle. The meltshop at Borgo Valsugana has a 1 million mt/year capacity, producing billet for rolling at Odolo and in theory at Roe Volciano. Borgo Valsugana last year worked at 40% of its capacity, but since December it has not produced any material. The rolling mill at Roe Volciano has a capacity for 400,000 mt/year of rebar and did not produce anything last year. With this acquisition, Klesch seems set to enter the Italian steel industry after bidding unsuccessfully last year for Lucchini, as well as for aluminum producer Alcoa. --Annalisa Villa, annalisa_vila@platts.com--Edited by James Leech, james_leech@platts.comSimilar stories appear in Steel Markets Daily. See more information at http://www.platts.com/Products/steelmarketsdaily