Arcelor shifts focus to Laiwu Steel Company shares
A report in a Chinese economic daily suggests that Arcelor, the worlds second largest steelmaker, will purchase a stake in
Laiwu Steel Company.
At the fifth
China International Steel and Raw Materials conference last week in Qingdao,
China, Zhang Shengsheng, general manager of
Laiwu Steel, disclosed that Arcelor intends to purchase shares of
Laiwu Steel Company (share code 600102.SH). Prior to Zhang Shengshengs confirmation, rumors had been linking Arcelor to a purchase of the
Laiwus H-beam plant or to the acquisition of a stake in
Laiwu Steel Group, the majority shareholder in
Laiwu Steel Company.
Zhang Shengsheng indicated that most difficult problem usually faced by foreign strategic investors is obtaining government approval. The move by Arcelor would not go against the policy, which prohibits foreign companies from taking a controlling stake in steelmakers, since
Laiwu Steel Group holds a majority stake in
Laiwu Steel Company.
The proposed move is similar to one recently made by Areclor rival Mittal Steel. Mittal Steel purchased a 36.67 percent stake in a listed company named Valin Steel Tubes, in which Valin Iron and Steel Group controls a majority stake.
Arcelor spokesman Luc Scheer said that while he could confirm that Arcelor was in talks with
Laiwu Steel, he could not comment on the specifics of the talks.
SteelOrbis Shanghai