ArcelorMittal Kryvyi Rih

ArcelorMittal Kryvyi Rih (former Kryvorizhstal () is Ukraine's largest integrated steel company located in Kryvyi Rih city.
Bought in 2005 by Mittal Steel, the plant is one of the most important businesses in Ukraine and a globally important steel producer. In Ukraine it is the largest steel manufacturer of both rebar and wire rod. Also ArcelorMittal Kryviy Rih specializes in manufacturing of sections, angles, strips and billets. Steel plant produces over 6 MT of crude steel, 5 MT of rolled products and 5.5 MT of hot metal.
Production.
Located fully in Kryvyi Rih, this steel company was built as an integrated mining and steel plant, comprising:
Production Volumes of 2019
Background.
The presence of iron ore in the regions around Kryvyi Rih has been known since at least 1781 and was rumoured before; being known to the ancients. Throughout the 1800s the region was investigated for its mineral wealth. Iron ore of 70% iron content and manganese ores were found. In 1881 the industrial extraction of iron ore began, alongside other developments such as the construction of Kryvyi Rih railway. By 1884 over 100 000 tons of iron ore had been extracted, and the railway though Kryvyi Rih, 477 versts (505,6 km) long, from Yasynuvata station via Kryvyi Rih to Dolynska station had been opened. The production expanded rapidly in the next years. By 1896 there were 20 mines producing over 1 000 000 tonnes of ore in Kryvyi Rih Basin. Industrial expansion continued in the region up to 1917. Production dropped during the first world war.
Foundation and growth in Soviet Union.
After the formation of the Soviet Union and the expulsion of Austro-Hungarian forces and then anti-communist forces under Anton Denikin occupying the region relative normalcy was resumed. Planning of the plant began in 1929, with the intention being to produce an integrated steel plant taking iron ore and carbon all the way to finished steel products. In 1931 the chairman of the Supreme Economic Council of the USSR - Grigori (Sergo) Ordzhonikidze signed a decree ordering its construction and the same year the foundation stone of the metallurgical plant was laid. In August 1934 the first metal was produced at Kryvorizhstal; later known as 'Kryvyi Rih Metallurgical Plant'.
Before the onset second world war the plant operated with 3 Blast Furnaces (of 3 160 m3) and 2 open hearth furnaces along with a heat and power plant. In 1941 a blooming mill of 1.7 million tonnes p.a., fourth Blast Furnace and third open hearth furnace came on line shortly before nazi occupation.
Prior to occupation by German military forces equipment and employees were evacuated to Nizhny Tagil. During the German administration (from the 14th of August 1941 to the 22nd of February 1944), the plant was destroyed.,
After the recapture of the area the plant was rebuilt, and continued to grow again. Blast Furnace No.7 was built in 1962 and Blast Furnace No.8 was built in 1970, making the plant the largest in Europe. In 1974 Blast Furnace No.9 was opened the biggest in the world with a volume of 5 000 m3.
Ukrainian independence.
In 1996 restructuring took place, combining the mining and ore concentrating unit "Novokrivorozhsky HZK" ("Новокриворізький ГЗК (НК ГЗК)") (NK-HZK) with the Kryvyi Rih State Mining and Metallurgical Combine (Kryvorizhstal) ("Криворізького державного гірничо-металургійного комбінату "Криворіжсталь"") into one unit. Kryvyi Rih coking plant ("Криворізький коксохімічний завод (ККХЗ)") was included in the group in 1997, forming "Novokrivorozhsky mining and processing combine and Kryvyi Rih coking plant" ("Новокриворізький гірничо-збагачувальний комбінат і Криворізький коксохімічний завод «Криворіжсталь»") or simply Kryvoriszhstal. Technically this was simply a paper exercise, three units had been always been designed to work jointly, and the factory facilities were on the same site.
In 2004 it became a public company and was privatised.
First privatization, 2004.
Kryvorizhstal became internationally known when it was privatized in June 2004 for a sum of US$800 million, (4.26 billion Hryvnia.) against a government-set reserve price of $714 million, to a consortium called Investment-Metallurgical Union. This consortium included Rinat Akhmetov's SCM and Interpipe Group, controlled by then-President Kuchma's son-in-law Viktor Pinchuk. Higher offers from foreign investors including a joint bid from Severstal/Arcelor, and a bid from Tata Steel were rejected on bidding technicalities. The deal was widely criticized by the opposition and abroad as an example of corruption and state property mismanagement.
By initiative of the new President Viktor Yushchenko, the privatization deal was dismissed by the court in June 2005, in order to sell the company again in a fair auction.
2005, Second privatisation and ArcelorMittal company.
At the time of the second privatisation the company had annually sales of $1897 million with a net profit of $378 million, and cash of $413 million. The plant had a production capacity of ~10 million tonnes of raw steel, and rolling capacity for under 7 million tonnes, and was able to source most of its requirements for iron ore and coke locally. The bidding process was broadcast live on Ukrainian television, with Arcelor, Mittal Steel and Vadim Novinsky's Smart Holdings bidding - Mittal Steel was the highest bidder and acquired a 93.02 percent stake in Kryvorizhstal on October 24, 2005, for 24.2 billion hryvnia (US$4.81 billion) - Mittal Steel was expected to finance the acquisition from its own cash reserves and from a $3 billion loan arranged with UK based Citigroup. The price exceeded analyst predictions of $3 billion, making it the largest privatization deal in the former Soviet Union.
In 2006 the company was renamed as Mittal Steel Kryvyi Rih (Ukrainian : "ВАТ «Міттал Стіл Кривий Ріг»"), later in 2007 after the takeover of Arcelor by Mittal steel to form ArcelorMittal the company was renamed as ArcelorMittal Kryvyi Rih.
During the late-2000s financial crisis steel production decreased from 8.1 million tonnes in 2007, to 6.2 million tonnes in 2008, and to 5 million tonnes in 2009, with decreases in other production metrics, as well as revenues, with the business making a net loss of 120million UAH in 2009 (from a profit of 4.7 billion UAH in 2008). Production levels recovered to 2008 values in 2010.
Investments
Over the last 14 years in Ukraine, the company's total investments amounted to USD 9.7 bln (US$4.85 bln - the acquisition value + USD 4.4 bln - investments in the production development).
Major investment projects (2006-2019):
Mauro Longobardo appointed as Chief Executive Officer of ArcelorMittal Kryvyi Rih, effective from February 18, 2020.