On August 6, 2024, ArcelorMittal, one of the world’s preeminent steel manufacturers, finalized a significant transaction by acquiring a 28.4% stake in Vallourec, a prominent French pipe manufacturer. Valued at approximately €955 million, this strategic investment marks a notable expansion of ArcelorMittal’s influence in the global pipe market. The acquisition, which was approved by all relevant regulatory authorities, reflects ArcelorMittal’s ongoing commitment to bolstering its presence in key industrial sectors and advancing its sustainability objectives.
Vallourec, with its substantial operations in the United States and Brazil, aligns with ArcelorMittal’s strategic focus on markets with strong growth potential. The company specializes in manufacturing high-quality pipes for the energy, automotive, and construction industries. Notably, Vallourec’s production facilities are concentrated around low-carbon integrated production centers in these regions, with 85% of its rolling capacity situated in these environmentally-conscious facilities.
The deal also resulted in notable appointments within Vallourec’s governance structure. Genuino Magalhaes Cristino has been named Director of Vallourec, joining the Audit and Remuneration Committees. Additionally, Aditya Mittal has been appointed to Vallourec’s Supervisory Board, while Keith James Howell will serve as an advisor on the Nomination and Governance Committee. These appointments are expected to facilitate a seamless integration and enhance the strategic alignment of Vallourec’s operations with ArcelorMittal’s global objectives.
Vallourec’s commitment to reducing its carbon footprint is evident from its production data. The company’s steelmaking facilities in Brazil and the United States emit 0.945 metric tons of CO₂ and 0.290 metric tons of CO₂ per metric ton of steel, respectively. Vallourec has set ambitious goals to reduce these emissions by 30% by 2030 and 35% by 2035, compared to 2021 levels. This aligns with ArcelorMittal’s sustainability goals and supports the broader industry shift towards greener production practices.
In the fiscal year 2023, Vallourec reported an EBITDA of €1.2 billion from sales amounting to €5.1 billion. The company anticipates a 10-15% increase in EBITDA by 2030, driven by the global transition to green production technologies. This growth projection underscores the potential benefits of ArcelorMittal’s investment and the strategic importance of this acquisition in the evolving steel and pipe markets.
The acquisition of the Vallourec stake was initially announced in early March 2024 and has since been subject to extensive regulatory review. With the completion of this transaction, ArcelorMittal has not indicated any plans to further increase its stake in Vallourec in the immediate future. Instead, the focus will likely be on leveraging this strategic position to enhance collaboration and drive innovation in the pipe manufacturing sector.
