Agreement extended on Laiwu deal with Arcelor
(Shanghai Daily)Updated: 2007-01-05 15:49 Laiwu Steel Group is in talks with Arcelor Mittal SA to extend the terms of an agreement under which the Chinese company would sell a 38.41 percent stake in its listed unit.
In a filing with the Shanghai Stock Exchange yesterday, Laiwu Steel Corp said the deal is still awaiting approval from the Chinese government, and that its parent and Arcelor Mittal plan to extend a share sale agreement to ensure "smooth proceedings for approval."
The Shandong Province-based mill didn't say when the agreement, signed in February, will expire.
The share sale, if approved, would give Arcelor Mittal a stake that's equal to the ownership held by Laiwu Steel's state-owned parent. The state could still maintain a controlling role via a 1.19 percent stake held by a Shandong government investment arm.
Arcelor in February agreed to buy the stake for 2.09 billion yuan (US$266.2 million).
The deal is under significant scrutiny as it has failed to secure state
approval in almost a year, triggering concerns that the government may block it
over competitive concerns.
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