Esmark to decide on Severstal's $1.24-billion offer by 13 June

Mumbai: The board of US steel maker Esmark Inc will decide whether to accept a takeover offer from Russian metals giant OAO Severstal by Friday, its chairman and chief executive Jim Bouchard said.

Severstal's bid, worth about $1.24 billion, is backed by the United Steelworkers union, which had threatened to block the offer from rival Indian bidder Essar.

Essar said it was considering raising its bid after Esmark's largest shareholder backed the Severstal offer.

Franklin Mutual Advisers, which owns about 60 per cent of Esmark's shares, said in a regulatory filing that it tendered all its shares into the Severstal offer because the United Steelworkers is opposed to the Essar bid.

Both Severstal and Esmark have offered $17 per share for Wheeling, West Virginia-based Esmark, which owns steelmaker Wheeling-Pittsburgh.

Essar, meanwhile, has loaned Esmark $110 million to help it avoid default. It has also proposed $525 million spending on Esmark's plants in West Virginia and Ohio over the next five years.