China steel mills to bid for Brazil CSN unit – WSJ

Deals

A consortium of Chinese steelmakers and the country’s sovereign wealth fund will bid for a stake in the iron ore unit of Brazilian steelmaker Companhia Siderurgica Nacional SA, the Wall Street Journal reported on Friday.

Major steel producers, including Baosteel Group, Shougang Group and Shagang Group, as well as China Investment Corp, a $200 billion investment arm of the Chinese government, are entering the initial round of bidding for Nacional Minerios SA, or Namisa, CSN’s unlisted iron ore unit.

The composition of the consortium had yet to be finalized, the newspaper quoted an unnamed source as saying. Officials at Baosteel Group, Shougang Group, and the China Investment Corp said they were unaware of the bid, while Shen Wenming, Vice President of Shagang Group, said he was unclear on the bid and was unwilling to elaborate further.

China, the world’s top steel producer, lacks quality iron ore deposits, and is increasingly turning overseas to secure supplies of iron ore and other resources. But the country’s steel mills failed to cooperate quickly enough last year to buy into Australian miner Rio Tinto, even though they wanted to block its acquisition by fellow Australian BHP Billiton. Aluminum Corp of China, or Chinalco, beat them to the punch when it bought a minority stake in Rio late last year. (Reuters)

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