Threats by the French government to nationalize a
steelworks belonging to ArcelorMittal hung over planned talks Tuesday
between French President Francois Hollande and Lakshmi Mittal,
founder of the world's largest steel producer.
Mittal has been summoned for talks Tuesday evening over the future of the plant at Florange, in the north-east of France, where ArcelorMittal has announced the closure of two blast furnaces.
Citing falling demand for steel in Europe the company in October announced the closure of the furnaces, which employ 629 people, but said it planned to continue downstream (processing) activities at the site.
The government says the company's refusal to sell the entire site is thwarting its attempts to find a buyer for the furnaces.
Industrial Recovery Minister Arnaud Montebourg told Les Echos newspaper in an interview Monday that the government was considering nationalizing the site on a temporary basis until a new partner could take over. He said two companies had expressed interest in acquiring the entire site.
ArcelorMittal has warned that selling the entire site would threaten the group's presence in France, where it employs 20,000 people.
As tensions mount ahead of a December 1 deadline for a solution Montebourg has hardened his tone against the steelmaker.
"We no longer want ArcelorMittal in France because they didn't respect France," the minister told Les Echos, accusing the group of "lies."
The Mittal family expressed shock over the remarks, which come as Hollande's Socialist administration attempts to shed a reputation of being anti-business caused by previous attacks by Montebourg on business leaders.
London Mayor Boris Johnson, who is currently on a tour of India, seized on the comments to urge Indian investors to choose London over Paris.
Referring to a radical faction in the 1789-1799 French Revolution Johnson said the "sans-culottes appear to have captured the government in Paris" and offered: "Venez a Londres, mes amis' (Come to London, my friends).
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