Sa Steel Crisis: Govt May Pay R500m In Salaries To Keep Mills Open, Sources Say

South Africa is nearing a deal to provide funding to ArcelorMittal SAs local unit and keep the steel mills open, which are crucial for the nations economy, people with knowledge of the matter have said.

The government plans initial support of about R500 million specifically to pay steelworkers over a period of six to eight months, said the people, who asked not to be identified because the information is private.

It is also discussing additional bridge financing through the state-owned Industrial Development Corporation, which will then raise its stake in the company from its current level of about 8, the people said.

The government, working through the states trade department and the IDC, also wants ArcelorMittal South Africa, known as AMSA, to consider offers for the two mills it plans to close, situated in the towns of Vereeniging and Newcastle, according to the people.