Severstal will remain Russian after merger with Arcelor: Mordashov

Moscow, May 27 (UNI) Severstal CEO Alexei Mordashov today said Severstal will remain a Russian company even after its merger with the European steel giant Arcelor.

''It will remain a Russian company whose shares will be quoted on the Russian exchange,'' Severstal Board Chairman and controlling shareholder Alexei Mordashov said at a press conference.

Severstal's assets will be governed by Russian managers and Arcelor's assets by its own managers, Mr Mordashov said, adding that 25 per cent of Severstal's shares would remain under the Cherepovets-based company's control.

Arcelor and Severstal yesterday announced that their merger will create the world's biggest steel company with capacity to produce 70 million tonnes of steel annually. The merger is expected to generate synergies estimated at 590 million euros (570 million dollars).

''A synergic effect from the deal is expected at 590 million euros. But we see great potential for cutting production costs.

The figure will be substantially higher,'' Mr Mordashov noted.

The new company with 46 billion euros and 70 million tonnes of production will be the world's largest steel maker, the companies said in a joint press release.

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