Italy files appeal to stop ArcelorMittal dropping steel deal

Rome : The Italian government said it filed a legal appeal on Friday designed to prevent global giant ArcelorMittal from walking away from a 2018 deal to buy Europe's largest integrated steel-making mill.

Rome considers the troubled Ilva steel mill in the southern city of Taranto a "strategic" industrial site, Prime Minister Giuseppe Conte said in a statement.

"The government will not allow the deliberate closure of the blast furnaces" at the site as it would amount to ending any chance of investment to make the site viable and safeguard some 8,000 jobs, he said.

Conte added that if ArcelorMittal walked away from the badly polluted site it would be "a clear violation of contractual commitments and cause grave harm to the national economy."

He said the group would "have to answer in the courts" and face paying damages to the Italian state.

The Taranto plant in the south of Italy is mired in controversy because experts believe that some 7,500 people have died in the surrounding area as a result of diseases linked to toxic emissions.

ArcelorMittal began leasing the plant -- with an obligation to buy it -- late last year and had plans to invest 2.4 billion euros ($2.67 billion) to revive it, including 1.2 billion euros to curb pollution by 2024.

The group was given a period of legal immunity to bring the plant up to environmental standards. But the Italian parliament revoked that decision and the company lost its immunity on November 3.

The next day ArcelorMittal announced it was pulling out the deal, blaming the decision to revoke its immunity. Last week the firm said it would hand over the plant to state-appointed administrators by December 4.

The Milan prosecutor's office has meanwhile opened a preliminary enquiry into the issue to determine if a crime has been committed, city prosecutor Francesco Greco said.