Huge job cuts in view at Italy's Ilva steelworks

Both takeover bids for Italy's giant Ilva steel producer envisage slashing at least 40 percent of its 14,200 jobs, unions said Tuesday after talks with the government and administrators.

Nationalised and under special administration, Ilva's main facility at Taranto in southern Italy is notorious as one of the most polluting industrial facilities in Europe but also an economic lifeline in a region blighted by high unemployment.

Two consortiums have put forward rescue plans with global steel giant ArcelorMittal's partnership with Italy's Marcegaglia said to be favoured by the administrators over a rival team including Indian group Jindal South West Steel, Italian specialist steelmaker Arvedi, the Italian state's CDP investment bank and Delfin, the holding company of Italian businessman Leonardo Del Vecchio.

According to union officials, the Mittal-led consortium wants to reduce staff numbers from 14,200 currently to 8,400 by 2023 while the rival bid would cut headcount to 7,800 by next year but then bring it back up to 10,300 by 2023.

Union boss Maurizio Landini said the plans were unacceptable.

"The meeting was disappointing ... we don't even understand why one offer has been preferred over the other," he said.

Further talks with unions are scheduled for Thursday before Economic Development minister Carlo Calenda makes a decision.

ArcelorMittal has promised to invest 2.3 billion euros into Ilva in addition to a reported purchase price of early two billion euros.

Some 1.1 billion euros of the investment will go towards environmental cleanup while 1.2 billion will go into production improvements. Toxic emissions from the Taranto plant have been linked to high cancer rates in the area.