Aarsteel, a prominent player in the roofing sheet market in Nigeria, has officially closed its doors, citing a myriad of challenges that led to its downfall. The Ota-based steel plant has been experiencing operational difficulties for nearly a year, leading to its inability to secure the necessary funding to sustain its operations.
Sources close to the matter have revealed that Aarsteel was heavily burdened by severe indebtedness resulting from forex exchange losses, unfavorable economic policies, and the influx of substandard goods into the market. This led to a situation where the company was forced to sell its products at a price below the cost of production, making it unsustainable to continue business operations.
In light of this development, several Nigerian and Indian steel companies have expressed interest in acquiring Aarsteel in a bid to salvage the thousands of direct and indirect jobs tied to the company’s value chain. The Chairman of the Galvanized Iron Steel Manufacturers Association has expressed disappointment over the closure of Aarsteel, but remains hopeful that capable companies like KAM HOLDING can step in to revive the plant.
Industry stakeholders, including the Manufacturers Association of Nigeria (MAN) and the Nigerian Association of Chambers of Commerce, Industry, Mines and Agriculture (NACCIMA), have called on the government to take decisive action to address the root causes of business collapses like Aarsteel. They emphasize the need for a coordinated effort among government agencies to tackle economic, forex, power, and ease of doing business challenges to prevent similar scenarios in the future.
