ArcelorMittal drops US plant sale as buyer fails to arrange funds

17 December 2007

Mumbai: ArcelorMittal, the world's largest steelmaker, has terminated an agreement to sell its Sparrows Point, Baltimore facility to E2 Acquisition Corp as the latter failed to secure financing.

The agreement was terminated on the direction of a court-appointed trustee and the trustee expects to finalise a transaction at the earliest, ArcelorMittal said in a statement.

US anti-trust authorities had, early this year, ordered ArcelorMittal to divest the plant as a condition for granting regulatory approval for Mittal's $35 billion takeover of Arcelor.

ArcelorMittal had, on 2 August announced a deal to sell the plant to E2 Acquisition Corp, a joint venture between Esmark and Wheeling Pittsburgh Corp, with a deadline set for 30 November which was later extended to December 11.

The US Department of Justice also had, in September, approved the sale of the Sparrows Point steel mill for roughly $1.35 billion.

The sale had to be terminated as the group failed to arrange funds, Luxembourg-based ArcelorMittal said in the statement. The deadline to complete the sale to E2 ended on December 11.