• Thursday, July 18, 2024
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BusinessDay

Aarti Steel Nigeria succumbs to economic pressure and closes shop

We have no plans to exit Nigeria – Aarti Steel

Aarsteel has closed shop, down and out, Aarti Steel having been into roofing sheet market for so many years with considerable market foot prints is finally saying good bye to Nigeria. The Ota in Ogun State based Steel plant has not been operating smoothly for almost a year with intermittent production which made it impossible to meet the funding requirements for the continuation of its operations.

Speaking to the reliable sources known to the matter, he spoke about the impact of severe indebtedness due to forex exchange losses, adverse economic policies, smuggled substandard goods which depressed the local pricing mechanisms forcing the company to sell at a price lesser than the company’s cost of production. These are primarily responsible for the shut-down of the plant.

According to Mr. Lateef Bello speaking to the correspondent, there are two major steel companies from Nigeria and a couple of Indian Steel companies showing their interest to buy and move on with the operation of the plant in order to save thousands of direct and indirect jobs associated with Aarti Steel’s value chain.

The Chairman of Galvanized Iron Steel Manufacturers Association (GISMA), a sub-sector of Basic Metal, Iron & Steel and Fabricated Metals Products under MAN expressed disappointment over the proposed sale of Aarti Steel engendered by the economic woes the company has found itself.

He, however remains optimistic that Nigeria has committed indigenous companies like *KAM HOLDING*, with the right expertise, financial strength and tenacity to revamp and turn around such distressed steel plants without much fuss.

On the onset of such business collapses, MAN and NACCIMA have reiterated their stand to FG at different fora for prompt action to arrest the menace.

Addressing economic, forex, power, ease of doing business related challenges requires coordinated efforts from all government agencies at top most level.