In order to cut debt, ArcelorMittal is selling 50% of its shipping business to Global Chartering Limited, with which it will enter into a joint venture.

The Luxembourg-based steelmaker, one of Northwest Indiana's largest employers, is selling half of its wholly owned shipping business DryLog Ltd. to the Mauritius-based shipping company in a move that will reduce its debt by $530 million.

"The joint venture will benefit from the combination of the two businesses' respective knowledge and expertise, and ArcelorMittal’s extensive annual cargo commitments, a portion of which will be handled exclusively by the (joint venture)," ArcelorMittal announced in a news release. "It will also benefit from DryLog’s ability to optimize transport solutions and its technical and commercial vessel management expertise. These factors will enable the joint venture to grow its operations and become a significant player in the international shipping industry."

Global Chartering Limited operates 28 dry cargo vessels ranging from Cape Size to Supramax that will become part of the new joint venture. The deal is expected to close before the end of the year.

ArcelorMittal will be able to pay down $500 million of its debt when the transaction closes and another $130 million in 2020.

"The transaction is part of ArcelorMittal’s commitment to unlock up to $2 billion of value from its asset portfolio by mid-year 2021," ArcelorMittal said in a news release.

The multinational steelmaker, the largest in the world by volume, reported $14.3 billion in debt at the end of the third quarter, up from $13.8 billion at the end of the second quarter. That does not include its recently closed $5.8 billion acquisition of Essar Steel India Limited as a 60/40 joint venture with Nippon Steel.

ArcelorMittal, which has industrial operations in 19 countries around the globe, made 92.5 million tons of steel and $76 billion in revenue last year. It employs around 10,000 steelworkers in Northwest Indiana.
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