Indian-Brazilian bidding war for steelmaker Corus
London (dpa) - India's Tata Steel and Brazil's CSN traded rival bids Monday in a battle for Anglo-Dutch steelmaker Corus aimed at creating the world's fifth-largest group in the sector.
Corus' board backed each increased bid as it came in, and the company's share price rose steadily.
Late Sunday Tata raised its previous offer by 10 per cent, putting up 500 pence a share to value Corus at 4.7 billion pounds (9.2 billion dollars).
CSN (Companhia Siderurgica Nacional) responded within hours with an offer of 515 pence, or 4.9 billion pounds, up from an earlier bid of 475 pence.
The Indian company, part of the huge Tata group, immediately said it was "considering its position."
Corus' shares rose 26 pence to 526 in late-morning trade in London. The price has risen some 80 per cent since the beginning of the year.
Either takeover would create the world's fifth-largest producer by tonnage with capacity at around 24 million tons a year and would combine the relatively high-tech skills possessed by Corus with low- cost iron ore resources.
CSN chief executive Benjamin Steinbruch said: "The strategic impetus for this combination is growth.
"Our goal is to unlock the value of our iron ore assets through Corus, transforming them into cost-effective, high-quality steel products using Corus' advanced engineering capabilities and its excellent European distribution platform," he added.
Backing the new CSN offer, Corus chairman Jim Leng said the offer was "consistent with our strategic objective of securing access to raw materials, low-cost production and growth markets."
Earlier Leng had backed the revised Tata offer.
Tata Steel chairman Ratan Tata said: "We remain convinced of the compelling strategic rationale of this partnership and the revised terms deliver substantial additional value to Corus shareholders."
Both CSN and Tata have offered to make contributions in excess of 125 million pounds to Corus' pension fund.
Corus has held talks with both companies over recent years, but speculation that the company would become a takeover target heightened after the Mittal-Arcelor merger earlier this year created the world's largest steelmaker by far with capacity in excess of 110 million tons.
Russian steelmaker Severstal has also shown an interest in Corus, but has withdrawn from the contest.
CSN, which owns iron ore mines in Brazil, was privatised in 1993. It produced 5.2 million tons last year.
Tata steel produces around 4.4 million tons of steel a year. The Tata group is one of India's largest conglomerates with interests ranging from tea to cars.
Corus, which employs around 47,000 people worldwide and has its main plants in Britain and the Netherlands, produced more than 18 million tons last year. The company was formed from the 1999 merger of British Steel and the Dutch Hoogovens. © 2006 DPA
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