Essar Steel has joined the race to bid for a US unit of Severstal, Russia’s largest metal producer, as the Ruias-promoted company prepares to build capacity overseas after acquiring raw material assets in the US.
So far, steel major US Steel, the Renco Group and Aurora Capital Corp have expressed interest in bidding for Severstal’s American units. Severstal has put its three units in the US on the block — Sparrows Point in Maryland, Warren at Ohio and the Wheeling plant in West Virginia. While Severstal is looking for buyers for the three plants, according to people connected with the development, Essar is keen only on the Sparrows Point unit.
An Essar Steel spokesperson said: “As a group, we keep looking at growth opportunities in the businesses that we are in. However, it is not our policy to comment on any specific proposal.” The Ruia Group has interests in the US through its $1.6-billion steel plant in Minnesota and coal mines in Trinity. Essar owns iron ore mines at Minnesota and has also built a sponge iron plant to be used as feedstock for the 4-million tonne Algoma plant in Canada.