Arcelor Mittal, the world's top steel maker, could increase its stake in China's Hunan Valin Steel Tube & Wire Co to one-third, Xinhua reported according to a stock exchange filing yesterday.
Arcelor Mittal, which owns 29.5% in Valin, could enlarge its stake to 33.3% after acquiring 49.3% of the 520 million new shares offered in a private placement by Valin, based in Changsha, Hunan Province.
The price is good for Mittal Arcelor," said Xinhua, quoted Citic Securities analyst Zhou Xizeng as saying. "And Valin needs the funding to help buy more assets from its parent to bolster the value of the listed arm."
Valin said it will use the new capital to buy stakes in several subsidiaries from its parent as well as to build facilities to boost steel plate capacity and cut pollution.