Aarti Steel Nigeria succumbs to economic pressure, shuts down plant

Aarti Steel Nigeria which has been into roofing sheet production for many years with considerable market foot prints may finally be saying good bye to Nigeria, according to sources. The Ota, Ogun State-based Steel plant has allegedly not been operating smoothly for almost a year with intermittent production which made it impossible for the company to meet the funding requirements for the continuation of its operations.

A source hinted that the impact of severe indebtedness due to forex exchange losses, adverse economic policies and other factors which depressed the local pricing mechanisms forced the company to sell at a price lesser than its cost of production. These factors were said to have been primarily responsible for the shut-down of the plant.

The source further disclosed that two other major steel companies based in Nigeria and a couple of Indian steel companies have shown interest to buy the closed plant and continue the company’s operation in order to save thousands of direct and indirect jobs associated with its 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 downturn 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 the federal government 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 topmost level.

Aarti Steel Nigeria has been in business in the country for over a decade and had established itself as a reliable business partner for numerous customers in Nigeria and beyond. Before the prevailing economic downturn, the company had built an enviable reputation for providing high-quality products at competitive prices, backed by prompt and efficient service.