Reuters Posted online: Wednesday, December 20, 2006 at 1232 hours IST Updated: Wednesday, December 20, 2006 at 1235 hours IST
Moscow, December 20: The world's biggest steelmaker, Arcelor Mittal, has offered to buy a controlling stake in Russian steelmaker MMK, Vedomosti newspaper quoted a source close to the owners of MMK as saying on Wednesday.
Vedomosti said Arcelor Mittal representatives visited MMK a month ago and the firm had made an offer to its main owner Viktor Rashnikov. The paper did not say how much Arcelor Mittal had offered to pay.
The paper said a co-owner of MMK had confirmed the talks had taken place. But it said one source said the talks had not advanced further.
Vedomosti said MMK's spokeswoman Yelena Azovtseva declined to comment. She was not immediately available when Reuters tried to contact the company on Wednesday.
The companies already have a business relationship, with MMK buying coal from the Mittal Steel Temirtau subsidiary in Kazakhstan.
Mittal Steel, which this year merged with Arcelor, last year paid USD4.8 billion for Ukraine's Kryvorizhstal steel mill in that country's biggest ever privatisation.
Arcelor Mittal Chief Executive Lakshmi Mittal said last month that the global steel industry needs further consolidation to improve pricing power and to keep an eye on China's increasing influence.
According to an agency data, MMK has a market capitalisation of about USD9 billion.
Located in the southern Ural mountains, the firm produced 11.4 million tonnes of crude steel last year and posted a net profit of USD947 million. Its free float stands at about 1 per cent, with the rest held by Rashnikov and management.
In May, Forbes magazine listed Rashnikov as Russia's 16th richest man, with a personal fortune of USD5.4 billion.
Moscow, December 20: The world's biggest steelmaker, Arcelor Mittal, has offered to buy a controlling stake in Russian steelmaker MMK, Vedomosti newspaper quoted a source close to the owners of MMK as saying on Wednesday.
