Mumbai: ArecelorMittal, the world's largest steelmaker, has agreed to acquire a 49 per cent stake in Brazilian mining company Mineracao Piramide Participacoes (MPP) for an undisclosed price.
MPP, based in Corumba in the state of Mato Grosso do Sul, focuses on exploration and development of iron ore and manganese reserves in the region.
Luxembourg-based ArcelorMittal said the price is yet to be assessed but added it plans to make additional investments to increase MPP's iron ore production capacity in the short term.
''The price to be paid by ArcelorMittal will be calculated based on the amount of iron ore and manganese reserves `in situ' assessed according to the code for the reporting of mineral resources and ore reserves of the Australasian Joint Ore Reserves Committee (JORC),'' the company said.
''This investment represents a continuing development in our strategy of upstream integration,'' said Sudhir Maheshwari, ArcelorMittal director responsible for merger and acquisition, project and business development said.
''Securing supplies of iron ore is an important part of that strategy and will contribute to the future sustainability of our business,'' he added.
''ArcelorMittal also plans to make additional investments to increase MPP's iron ore production capacity in the short term,'' the company said in the statement.
ArcelorMittal, meanwhile, said it has garnered local support from Orissa's Keonjhar district for the proposed 12 million tonne steel plant in India and hopes to take possession of the required land by the end of the year.
''We are hopeful of taking physical possession of the land by the end of the current year to start construction for the greenfield steel project. The pre-land acquisition process has already been successfully initiated,'' said ArcelorMittal CEO India, Vijay Bhatnagar.
The response from local residents during the first Gram Sabha, held on 6 August as part of the pre-land acquisition process, was positive toward the Rs 40,000-crore project, which requires 7,750 acres of land, he said.
The company would acquire the land after the state issues notification on the completion of gram sabhas. Of the 7,750 acre land required for the project, about 6,000 acres would be needed for the steel plant, 1,000 acres for the captive power plant and a bout 750 acres for the township.
ArcelorMittal has operations in more than 60 countries, employing over 320,000 people worldwide.