LUXEMBOURG – An Asian-led consortium is acquiring a 15 per cent state in ArcelorMittal Canada for $1.1 billion in cash.
The transaction, announced Wednesday, calls for a group led by South Korean steelmaker POSCO and China Steel Corp. to enter into a joint venture partnership that will own ArcelorMittal’s Labrador Trough iron ore mining and infrastructure assets.
The consortium also includes other investors, who were not identified in the announcement.
As part of the deal POSCO and CSC will enter into long-term iron ore off-take agreements.
“This joint venture, incorporating a long-term off-take agreement, is consistent with our strategy to forge strategic relationships with key customers as we build our global mining business,” said Peter Kukielski, ArcelorMittal’s chief executive for mining.
“The consortium will be an excellent partner as we pursue further expansion at AMMC,” added Kukielski, who is also a member of the group management board.
The deal is subject to various closing conditions, including regulatory clearance by the Taiwanese government.
It is expected to close in two instalments in the first and second quarters of 2013.
ArcelorMittal is a leading integrated global steel and mining company, with a presence in more than 60 countries.
In 2011, ArcelorMittal had revenues of $94.0 billion and crude steel production of 91.9 million tonnes, representing approximately 6 per cent of world steel output.