Iceland Ferrosilicon Plant in Chinese Ownership Skip to content

Iceland Ferrosilicon Plant in Chinese Ownership

The ferrosilicon plant Elkem Iceland on Grundartangi by Hvalfjördur in west Iceland is now in Chinese ownership; its previous owner, the Norwegian industrial giant Orkla announced yesterday that the parent company Elkem AS had been sold to China National Bluestar.

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A factory worker in Iceland. The photo is not directly related to the story. By Geir Ólafsson.

The Chinese state company ChemChina Corporation holds an 80 percent share in China National Bluestar and the American investment company Blackstone Group holds the remaining 20 percent. So one could say that Elkem Iceland is now indirectly owned by the Chinese government, Fréttabladid reports.

CEO of Elkem Iceland Einar Thorsteinsson does not believe the acquisition will bring about significant changes for the ferrosilicon plant. “If we look a few years ahead in time there will be no changes with us because of [the acquisition].”

He is not concerned that the factory on Grundartangi will be shut down or moved to China. It isn’t a feasible option, he stated, as the factory almost only serves markets in Europe.

“We have been in a phase of development in the past years after a period where little was done. The factory is in good condition and there are no changes planned,” Thorsteinsson iterated.

According to Norwegian news website e24.no, China National Bluestar paid USD 2 billion (ISK 240 billion, EUR 1.5 billion) for Elkem AS, which is similar to the amount experts were expecting.

The acquisition, which has yet to be approved by the Chinese government and competition authorities in Norway, includes Elkem Silicon Materials, Elkem Foundry Prodcuts, Elkem Carbon and Elkem Solar.

When asked on her take on the acquisition, Minister of Industry Katrín Júlíusdóttir said she is in favor of it. “I don’t see how it would change anything for us Icelanders whether the company is in Chinese or Norwegian ownership. It is one foreign private company making a sale to another foreign private company.”

“We have our regulatory framework and these new owners must follow it, just as the Norwegians have done until now,” Júlíusdóttir added. “One can also look at the positive element in it, that a company in Iceland is considered a good investment option. That must be positive news for Iceland.”

According to visir.is, the Chinese company’s interest in Elkem was first reported early this winter but the acquisition was delayed due to China’s discontent with Chinese activist Liu Xiaobo receiving the Nobel Prize for Peace last year.

Click here to read a recent story of a similar topic.

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