Kazakh Government Finalizes Deal with ArcelorMittal for $286 Million

ASTANA – The Kazakh government and ArcelorMittal have completed negotiations for the purchase of all shares of ArcelorMittal Temirtau and ArcelorMittal Tubular Products Aktau by the Kazakh state investment fund, Qazaqstan Investment Corporation (QIC), for $286 million, announced Minister of Industry and Construction Kanat Sharlapayev at a press briefing on Dec. 8.

Kanat Sharlapayev at a Dec. 8 briefing in the Kazakh government. Photo credit: Ministry of Industry and Construction.

“The cost of the two assets amounted to $286 million. We did not expend funds from the national budget. This is the value for two fully operational enterprises. ArcelorMittal does not make any further claims against Kazakhstan,” said Sharlapayev.

Under the terms of the agreement, QIC assumes full control and responsibility for the operations of these enterprises, which will undergo rebranding and receive new names. 

Sharlapayev also named the new investor – Andrey Lavrentyev, chairman of the board of Allur, Kazakhstan’s major car manufacturer and dealer. 

The minister noted the total investment volume over the next three years will be approximately $3.5 billion, with investments of more than $1 billion soon to enhance the operational efficiency of the enterprise.

The negotiations to transfer ownership to Kazakhstan began following a series of fatal incidents at ArcelorMittal Temirtau. 

In October, President Kassym-Jomart Tokayev instructed the government to cease investment cooperation with ArcelorMittal Temirtau following the fire at the Kostenko mine that killed 46 people. 

But Sharlapayev revealed that negotiations have been underway between the Kazakh government and ArcelorMittal Temirtau since the incident on Nov. 3, 2022, at the Lenin mine, a subsidiary of ArcelorMittal Temirtau.

On Dec. 9, 2022, a standstill agreement was reached, allowing the Kazakh side to conduct an assessment and audit of the enterprise. 

The talk spanned 11 rounds, said the minister. One of the key points of contention during the negotiations was ArcelorMittal’s initial request for a staggering $3.5 billion, a figure that significantly diverged from the calculations of international consultants. 

Sharlapayev underscored that this demand became a major obstacle, contributing to the protracted nature of the negotiation process.

“Our objective was to acquire the plant at a fair price, avoiding expensive and prolonged international legal disputes. The urgency and speed of the negotiations were also driven by the necessity to prevent any halt to the operation of the enterprise,” said the minister. 

He called the agreement “groundbreaking” and “holding exceptional importance for the country.” “We have successfully averted a multitude of risks that other governments have encountered,” he added. 

ArcelorMittal has also donated 16 billion tenge ($34.9 million) to the Qazaqstan Halqyna charitable foundation. The funds will be directed to support healthcare and education projects in the Karagandy Region, with half of them earmarked for the city of Temirtau.


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