ArcelorMittal, the world's biggest steel producer, has held informal discussions with Angang Steel about working with China's second-largest steel company in an effort to extend its presence in the country.
Lakshmi Mittal, the Indian billionaire chief executive and main owner of ArcelorMittal, proposed buying a near 25 per cent stake in Angang to Zhang Xiaogang, Angang's chairman, in a meeting just over two months ago.
Although financial terms were not discussed, a 25 per cent stake in Angang would cost ArcelorMittal at least $5bn, according to Angang's current market valuation.
While Mr Zhang turned down Mr Mittal's suggestion that ArcelorMittal should be allowed to take a 20-30 per cent stake in the government-controlled company, he told the Financial Times he would be keen in principle to allow the Luxembourg-based company a much smaller shareholding in Angang of 1-2 per cent. He was also open to co-operating with ArcelorMittal, for instance in new steelmaking or mining projects.
"We can work together. We have similar ideas," Mr Zhang said in an interview at Angang's headquarters in Anshan, northern China.
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