Mittal eyeing AK Steel deal -- FT Web site

New York/Brussels, May 8 (Reuters) Arcelor Mittal , the world's largest steelmaker, is looking to acquire AK Steel , the Financial Times reported on its Alphaville Web site, triggering a surge in AK Steel shares.

Shares of Ohio-based AK Steel rose to 39 dollars before the closing bell in New York from a close at 32.06 dollars on Monday.

FT Alphaville, which did not cite its sources or say how many people confirmed the report, said a deal could value AK at up to 40 dollars per share, or just under 4.5 billion dollars.

''We don't comment on market speculation,'' said Arcelor Mittal spokesman Jean Lasar.

An analyst covering Arcelor Mittal who declined to be named said he doubted Arcelor Mittal would go ahead with such a deal, pointing out possible anti-trust issues ''I see little chances of that happening,'' he said.

A European investment banker who follows the steel sector agreed and said an acquisition could raise competition concerns in the flat carbon market for the automotive industry in North America.

Arcelor Mittal previously committed to divest its US steel plant at Sparrows Point to address US competition concerns after it decided to keep Arcelor's Canadian unit Dofasco within the new merged group formed by Mittal's acquisition of Arcelor.

''They already have to sell Sparrow Points to close the Arcelor takeover. Do you think they could do this one?'' the banker asked.

Arcelor Mittal shares fell 2.2 per cent to 41.50 euros in Paris by 1235 GMT.

AK Steel reported more than billion in sales in 2006.

In its first-quarter earnings release, AK Steel said net earnings were .7 million, or 56 cents per share, compared with .2 million, or 6 cents per share, a year earlier.

REUTERS PM HS2024