Essar in race to buy ArcelorMittal's US mill

Essar Steel has emerged as one of the potential suitors for Sparrows Point mill of ArcelorMittal, with leading Russian steelmakers, according to a report.

"The most prominent suitors continue to be Russian producers, although Essar Group also has been mentioned prominently, according to market sources," the Metal Bulletin (MB) reported, adding that Essar has been the most recent company to express interest and has begun negotiations with Luxembourg-based ArcelorMittal.

JSC Severstal, Evraz Group and OJSC Novolipetsk Steel are all considered in the running for the plant, which the US Justice Department ordered ArcelorMittal to divest as part of anti-trust concerns related to tinplate production in the eastern United States.

"Essar has been in, and so have Severstal and Evraz," one industry source with knowledge of the situation said. "They all want it for the same reason: They see this market as a good one," MB said.

When contacted a Essar Steel spokesman said the company was open to good investment opportunities, but would not like to comment on any specific proposal.

Essar already owns Algoma Steel, Sault Ste Marie, Ontario, and the Minnesota Steel Industries operations that are set to begin construction this spring on the Minnesota Iron Range.