Paris: French Prime Minister Jean-Marc Ayrault said that a deal had been made with steel group ArcelorMittal for the plant that had been under threat of closure.

The government has not retained "a temporary nationalisation," Ayrault said, after marathon talks with ArcelorMittal. The steel group had committed to invest USD 234 million over five years in the endangered Florange site in northeastern France, he added.

For the past three days, France and ArcelorMittal have been locked in heated negotiations, pressed to meet a deadline set by the steel giant to find a buyer for two blast furnaces on the site in the northeastern Lorraine region.

The Florange site, where 650 jobs were on the line yesterday, has become of symbol of deindustrialisation in France's industrial sector, which has seen 750,000 jobs disappear in the last decade.

The dispute came to a head on Monday when Industrial Renewal Minister Arnaud Montebourg accused the steel group, owned by tycoon Lakshmi Mittal, of blackmailing France. They were "no longer welcome in France", he said, sparking outrage in business circles.

Reading from a statement, Ayrault said two blast furnaces closed by ArcelorMittal would be left intact for now, until EU financing was confirmed for an existing carbon-capture project. Both ArcelorMittal and France are stakeholders in this project.

A source inside the office of French President Francois Hollande said they still had the means to apply pressure on the tycoon, should that be necessary. "If (Mittal) acts like someone who doesn't respect his word there are ways to apply pressure," the Elysee official said.


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