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Erdemir shares jump as ArcelorMittal raises stake
Mon 16 Jun 2008
ArcelorMittal (ISPA.AS: Quote, Profile, Research, Stock Buzz), the world's largest steelmaker, bought a 11.31 percent stake in the Turkish steel company Erdemir, bringing its total ownership to 24.9 percent and sending Erdemir shares sharply higher.
At 0724 GMT Erdemir EREGL.IS shares were up 6.3 percent at 9.25 lira amid speculation ArcelorMittal was considering a bid for the whole of the company.
The value of the acquired stake, which Arcelor said in a statement was a strategic investment, is $869.25 million.
Erdemir's parent company, Oyak, said on Saturday it was not seeking an Industrial partner for Erdemir.
An ArcelorMittal spokesman declined to comment on whether his company sought to increase its stake further or if it wanted to start talks with Oyak.
Oyak had planned to buy Erdemir, formerly state-owned, in partnership with Arcelor -- now part of ArcelorMittal (ISPA.AS: Quote, Profile, Research, Stock Buzz)(MT.N: Quote, Profile, Research, Stock Buzz)(MTP.PA: Quote, Profile, Research, Stock Buzz) -- but went ahead alone.
ArcelorMittal also said in a separate announcement it has agreed to buy Bayou Steel, a U.S. producer of structural steel products for $475 million, subject to regulatory approval.
Bayou Steel, which employs 630 people, generated revenue of about $331 million for the 2007 financial year. (Reporting by Julien Ponthus and Birsen Altayli; Editing by Erica Billingham and David Holmes)
