Delayed salaries, a long search for an investor and lack of government support put the company's future in question
The Liberty Steel plant in Dudelange, which has been inactive for a long time, may be placed under external management due to the lack of progress in finding a new owner. The company is facing significant financial difficulties, which threatens its continued existence, Kallanish reports.
According to trade unions, the plant has not been in production for more than two years, and salaries have been paid to employees exclusively at the expense of the parent company, as the company does not meet the criteria for state support. However, in October, Liberty Steel failed to pay salaries for the first time, which only worsened the situation.
“Salaries for October have been delayed for 25 days. This is critical for a company that has not produced or sold products over the past two years. We believe that in the absence of any significant changes, the bankruptcy of the Liège and Dudelange plants looks inevitable,” said the union representative.
Amid the financial difficulties, the Luxembourg government tried to take control of the company with a view to selling it to a private investor, but Liberty Steel rejected the offer, considering it insufficient.
As of today, the plant’s staff has been reduced from 300 to about 150 employees. Some employees have retired and others have quit. Some of the staff still performs basic maintenance of the facility.
“There are customers who are interested in our products. However, without an investor or active production, these requests remain unanswered,” said one of the plant’s employees.
Meanwhile, the European steel market is experiencing a downturn, making it even more difficult to find buyers for the Dudelange and Liège plants. Nevertheless, Liberty Steel says it has made “significant progress” in negotiations with a potential investor.
The unions are calling on the Luxembourg government and the European Commission to take decisive action to save the plant and pay the workers’ wages. In response, they have already initiated legal proceedings to recover the unpaid wages.
In addition to the plants in Dudelange and Liège, Liberty Steel plans to sell the Italian Magona site. The total capacity of the company’s facilities exceeds 2.5 million tons of steel per year. However, the future of the Dudelange plant remains uncertain.
As reported earlier, ArcelorMittal has recently been granted the right to place Liberty Steel’s Eastern European division into administration. This decision of the London court, made on November 26, 2024, was due to the non-payment of a €140 million ($147.4 million) debt related to the acquisition of ArcelorMittal’s Eastern European assets by Liberty in 2019.
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