ZURICH (Reuters) – Austrian specialty steelmaker Voestalpine is in advanced talks to sell a majority stake in its Texas plant, it said on Sunday.

“In recent months, voestalpine has been conducting an open-ended market sounding to stabilize the business model of its direct reduction plant in Corpus Christi, Texas,” the Austrian firm said in a statement. “As a result of this examination, voestalpine is currently in negotiations to sell 80% of its shares in voestalpine Texas.”

Talks were at an advanced stage, it said, without disclosing a potential sales price.

Voestalpine announced plans to invest 550 million euros in a state-of-the-art plant in Corpus Christi in 2013.

The $1 billion plant in Corpus Christi opened in October 2016, with an annual capacity of 2 million tonnes of high-quality hot briquetted iron, or sponge iron, a pre-material used in steel production.

However, the plant has since faced setbacks ranging from construction delays to cost overruns totaling more than a billion dollars, as well as a challenging market situation amidst the COVID-19 pandemic.

Following write-offs, the Texas operation was valued at 448 million euros, Chief Financial Officer Robert Ottel said in November 2020.

Voestalpine recognised an impairment loss of 163 million euros on the Texas operations for its 2020-21 reporting year, as the plant was confronted with “sharply lower” demand.

However, during the first three quarters of its current 2021-22 reporting year, the Texas plant had benefited from “good demand for steel in North America,” the Austrian firm said in February, when it said it expected full-year earnings across the group at the upper end of its forecast.

(Reporting by Brenna Hughes Neghaiwi in Zurich; Editing by Matthew Lewis)