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ArcelorMittal renews bid for India's Essar with Nippon Steel

CEO of world's top steelmaker 'confident' after initial offer was disqualified

A worker at an ArcelorMittal steel mill. The world's leading steelmaker seeks growth in India through buying the bankrupt Essar Steel.   © Reuters

TOKYO -- ArcelorMittal, the world's biggest steelmaker, has submitted a new bid for India's bankrupt Essar Steel after a first round of offers was rejected, attempting a joint acquisition with Japanese partner Nippon Steel & Sumitomo Metal.

An Indian subsidiary of ArcelorMittal entered the re-bidding process on Monday, the partners said.

A winner is expected in late April. If they prevail, ArcelorMittal and the Japanese market leader would control India's fourth-largest steelmaker, which has large works in the western state of Gujarat.

Competitors include London-based metal company Vedanta Resources and a partnership between Russian financial group VTB and Indian market leader JSW Steel, according to Reuters.

A panel of Essar creditors dismissed ArcelorMittal's bid in the previous round in February, saying its past involvement in managing a local steelmaker that had willfully defaulted on debt precluded it from participating under Indian law.

For the new bid, Luxembourg-headquartered ArcelorMittal is "confident we are eligible; we are confident we have the strongest track record," Chairman and CEO Lakshmi Mittal said in a news release on Monday.

The sole opposing bidder in February's round -- Numetal Mauritius, a special-purpose company in which VTB is a major investor -- was also deemed ineligible.

Nippon Steel said in early March that it had agreed to form a joint venture with ArcelorMittal to buy Essar. The purchase is expected to cost several billion dollars, with the Japanese steelmaker possibly shouldering more than 100 billion yen ($944 million).

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