ArcelorMittal announces sale of Bosnian operations

Rhea-AI Summary

ArcelorMittal (MT) has signed an agreement to sell its Bosnian operations, including ArcelorMittal Zenica (integrated steel plant) and ArcelorMittal Prijedor (iron ore mining business), to Pavgord Group. The company expects to record a non-cash loss of approximately $0.2 billion on the disposal. The transaction, expected to close in Q3 2025, includes the transfer of all employee jobs to the new owner. The decision comes after a strategic review, despite considerable previous investments. ArcelorMittal has operated in Bosnia for 21 years and remains a global steel leader with operations in 60 countries, generating revenues of $62.4 billion in 2024 with production of 57.9 million metric tonnes of crude steel and 42.4 million tonnes of iron ore.

Positive

• All employees' jobs are being transferred to the new owner, maintaining workforce stability
• Strategic decision allows for better business development under new ownership
• Deal expected to close relatively quickly in Q3 2025

Negative

• Company will record a significant non-cash loss of $0.2 billion on disposal
• Loss of strategic assets in Bosnia after 21 years of operations
• Divestment reduces ArcelorMittal's European operational footprint

Insights

M&A Specialist

ArcelorMittal's Bosnian divestiture represents strategic portfolio optimization despite a $0.2B loss, allowing focus on core markets.

ArcelorMittal's decision to divest its Bosnian operations after 21 years represents a calculated strategic move to optimize its global portfolio. The $0.2 billion non-cash loss (including foreign exchange losses) suggests these assets were underperforming relative to ArcelorMittal's global operations. The sale includes both the Zenica integrated steel plant and the Prijedor iron ore mining business that supplies it, creating a vertically integrated package for the buyer.

This divestiture aligns with broader industry trends where global steel producers are rationalizing assets in smaller markets to focus capital and management attention on core operations. With operations across 60 countries and primary steelmaking in 15, ArcelorMittal likely evaluated these Bosnian assets against their global portfolio and determined they weren't strategic priorities despite "considerable investments and efforts" to maintain them.

The transaction preserves jobs by transferring all employees to Pavgord Group, mitigating potential political and social fallout. This suggests a responsible exit strategy that maintains goodwill with local governments. The expected closing in Q3 2025, pending regulatory approvals, gives both parties sufficient transition time.

For ArcelorMittal, with $62.4 billion in 2024 revenue, this divestiture represents a minor financial impact but demonstrates disciplined capital allocation. The company can now redirect resources toward higher-growth markets and its stated purpose of producing "smarter steels" with lower carbon emissions - initiatives likely offering better returns than the Bosnian operations.

20 June 2025, 15:30 CET

ArcelorMittal (“the company”) has today signed a sale and purchase agreement to sell its operations in Bosnia and Herzegovina. ArcelorMittal Zenica, an integrated steel plant, and ArcelorMittal Prijedor, an iron ore mining business which supplies the Zenica plant, will be sold to Pavgord Group. 

The company has made considerable investments and efforts to keep ArcelorMittal Zenica and ArcelorMittal Prijedor within the group. However, after a thorough strategic review, the company concluded that a sale is the best solution for the development of the business and its people.

Under the terms of the transaction, ArcelorMittal’s shares in ArcelorMittal Zenica and ArcelorMittal Prijedor will be sold to Pavgord Group, and all employees’ jobs are transferred to the new owner. Net of sale proceeds, the company expects to record a non-cash loss on disposal of approximately $0.2bn (including foreign exchange losses recorded in equity since the date of acquisition).

The deal is expected to close in the third quarter of 2025, subject to merger control clearance and the fulfilment of all conditions precedent. Until then, all operations of the company will continue as usual, with the full support of the local management team and the company leadership team.

“ArcelorMittal acknowledges the support of the government of Bosnia and Herzegovina, and the government of the Federation and Republika Srpska, during the 21 years that the company has been operating in the country. We believe the company will continue to be a major contributor to the economy of Bosnia and Herzegovina. We thank all our employees at ArcelorMittal Zenica and ArcelorMittal Prijedor for their hard work and passionate engagement during all these years and wish them all the best for the future, as well as to Pavgord Group in this new phase”, commented Sanjay Samaddar, Vice President ArcelorMittal and chief executive officer, ArcelorMittal Europe – Long Products.

Ends

About ArcelorMittal

ArcelorMittal is one of the world’s leading integrated steel and mining companies with a presence in 60 countries and primary steelmaking operations in 15 countries. It is the largest steel producer in Europe, among the largest in the Americas, and has a growing presence in Asia through its joint venture AM/NS India. ArcelorMittal sells its products to a diverse range of customers including the automotive, engineering, construction and machinery industries, and in 2024 generated revenues of $62.4 billion, produced 57.9 million metric tonnes of crude steel and 42.4 million tonnes of iron ore. Our purpose is to produce smarter steels for people and planet. Steels made using innovative processes which use less energy, emit significantly less carbon and reduce costs. Steels that are cleaner, stronger and reusable. Steels for the renewable energy infrastructure that will support societies as they transform through this century. With steel at our core, our inventive people and an entrepreneurial culture at heart, we will support the world in making that change.

ArcelorMittal is listed on the stock exchanges of New York (MT), Amsterdam (MT), Paris (MT), Luxembourg (MT) and on the Spanish stock exchanges of Barcelona, Bilbao, Madrid and Valencia (MTS).
http://corporate.arcelormittal.com/

Contacts:

ArcelorMittal Investor Relations        
General                +44 20 7543 1128
Sustainability        +44 203 214 2490

Bonds/Credit         +33 157 955 035
E-mail                investor.relations@arcelormittal.com

ArcelorMittal Corporate Communications        
Paul Weigh        +44 20 3214 2419
E-mail:                 press@arcelormittal.com

ArcelorMittal North America Communications
Chris Mason        +1 219 666 4636
E-Mail:                 northamerica.press@arcelormittal.com        

FAQ

What is the expected loss for ArcelorMittal (MT) from selling its Bosnian operations?

ArcelorMittal expects to record a non-cash loss of approximately $0.2 billion on the disposal, including foreign exchange losses recorded in equity since acquisition.

When will ArcelorMittal's (MT) sale of Bosnian operations close?

The deal is expected to close in the third quarter of 2025, subject to merger control clearance and fulfillment of conditions precedent.

Which ArcelorMittal assets in Bosnia are being sold to Pavgord Group?

ArcelorMittal is selling ArcelorMittal Zenica, an integrated steel plant, and ArcelorMittal Prijedor, an iron ore mining business that supplies the Zenica plant.

What will happen to ArcelorMittal's employees in Bosnia after the sale?

All employees' jobs will be transferred to the new owner, Pavgord Group, ensuring workforce continuity.

How long has ArcelorMittal operated in Bosnia before this sale?

ArcelorMittal has operated in Bosnia for 21 years before deciding to sell its operations to Pavgord Group.