Big Pivots

Ownership stake by Russian oligarch had been an issue since invasion of Ukraine

 

by Allen Best

Russian oligarch Roman Abramovich will soon recede into the background of Pueblo. He is the largest shareholder of Evraz, the owner of the steel plant, with a 28% stake, and Evraz is being sold to a private-equity firm called Atlas Holdings.

Atlas has agreed to pay up to $500 million, with most of the money deferred pending the performance of the business, The Wall Street Journal reported on Friday afternoon.

Colorado Gov. Jared Polis welcomed the news. “This sale is good for Pueblo and good for Colorado. The steel plant is an important employer in Pueblo and a major economic contributor to our state,” he said.

Polis reported that Atlas leadership had assured him that both new jobs and the plant expansion will continue.

Evraz had invested close to $1 billion in a state-of-the-art long-rail mill. Railroads want quarter-mile-long rails, and this mill will produce the parts more efficiently, Colorado pledged to contribute up to $17 million in transferable tax credits for the expansion.

Ownership of Evraz had been in question since Russia invaded Ukraine in April 2022. Although born without special privilege, Abramovich has accumulated vast amounts of money. He is commonly described as an oligarch with close ties to Vladimir Putin.

The British government sanctioned Abramovich in March 2022. He was forced to sell the soccer club Chelsea. The Evraz parent company in the U.K. has been unable to conduct business.

Evraz North American operates a dozen steel plants and has 3,400 employees.

The 300-megawatt Bighorn solar project on the land of the steel company — and also adjacent to the Comanche Generating Station — was dedicated in October 2022. Photo/Allen Best

The steel plant in Pueblo, then called CF&I, once employed many thousands of people, many of them first- and second-generation immigrants. Even in the 1950s, CF&I had about 12,000 employees at its various coal mines and other operations in Colorado.  Today, the plant has about 1,200 employees.

“We always knew this was coming,” said Jeff Shaw, chief executive of the Pueblo Economic Development Corporation. “We knew it was a complicated process because of the different countries involved: Canada, the United States and, obviously, the U.K., where shares were traded.

The plant at Pueblo became distinguished in October 2021 with the virtual completion of photovoltaic panels on Evraz land near the steel mill. The 300-megawatt Bighorn array allows Evraz to say that 90% of its power for the steel products is derived from renewable energy. The plant uses mostly recycled steel, which requires less heat than steel made from iron ore. See more about that story from 2022 here.

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