New Delhi, Nov 8: World's largest steelmaker Arcelor Mittal has acquired 28 percent stake in steel products maker China Oriental Group by paying 647 million dollars.
Arcelor Mittal has bought the stake from the firm's vice chairwoman, Chen Ningning, and her Smart Triumph Corp, after the latter fell short in her buyout bid for China Oriental last month.
Arcelor Mittal has now become China Oriental's second-largest shareholder.
Shares in China Oriental, which have tripled over the past year amid the buyout talk, were suspended on Nov 7, the China Daily reported.
Arcelor Mittal is the only foreign firm to have a direct ownership in a Chinese steel maker, through a nearly one-third stake in Hunan Valin Steel Tube and Wire, China"s tenth-largest producer.
The stake in China Oriental is expected to give Arcelor Mittal a platform in China's northern industrial province of Hebei, which is also rich in iron ore, to complement the Valin stake in the south.
China Oriental"s net profit for last year was of 1.03 billion yuan (138 million dollars). It sold about 3.75 million tons of steel products and generated sales of 1.3 billion.
Its main operating subsidiaries are Jinxi Iron and Steel in Hebei, and Foshan Jinxi in the southern province of Guangdong.
The stake acquisition assumes significance as Chen had been advocating for China Oriental to buy mills and participate in the consolidation of China's steel industry, and had signalled her intention to sell her stake in the firm if her takeover effort fell short.