Deadline for Arcelor Mittal's Chinese acquisition extended
30 December 2006
China's eighth largest steel maker Laiwu Steel Co Ltd, in which Arcelor Mittal is buying a minority stake, said the two sides had extended the deadline for the deal to wait for Beijing''s approval.
Incidentally, Laiwu and Jinan Iron and Steel Co Ltd, China''s seventh-largest mill, are due to merge under a provincial government plan to create the country''s second-largest steel maker.
If the deal meets with approval from the Chinese government, the combined Arcelor Mittal would own stakes in two of China''s leading steel firms, Laiwu and Valin Steel Tube and Wire, which has been bought by Mittal.
However, in each case Arcelor Mittal would have a minority stake just short of giving it actual control.
In a statement sent to the Shanghai Stock Exchange, Laiwu said that a new date was being discussed for finalising the stake sale with Arcelor Mittal, since the process of obtaining the necessary approvals had not been completed.
Arcelor had agreed in February to buy a 38.41-per cent stake in the Chinese listed company, representing half of the shares owned by Laiwu''s state-owned parent. The deal was set to be completed by March 31, 2007. Arclor and Mital are in the process of finalising their own merger.