ArcelorMittal to Expand in China through Acquisition
Steelmaking giant ArcelorMittal made public on October 15 news that it is to acquire a 90 per cent stake in the Chinese steelcord wire drawing company Rongcheng Chengshan Steelcord. ArcelorMittal will pay US$26.6 million for the Shangdong province based business.
Lakshmi Mittal, president and chief executive of ArcelorMittal said: “This acquisition is an important step for us in expanding in a major market. We have already shown through our joint ventures in China the value and skills we can bring the Chinese steel industry and we look forward to bringing our expertise to Rongcheng Chengshan Steelcord. As well as showing our commitment to the broader Chinese steel market, this acquisition also underlines our commitment to the wire business specifically and recognises China’s leading position in this sector.”
Rongcheng Chengshan Steelcord specialises in producing steelcord wire and bead wire used for tyre reinforcement. The company forecasts a turnover of RMB 536 million ($71 million) for 2007.