ArcelorMittal Says Rio Tinto's IOC Unit Would Be `If Arcelor is interested in IOC, surely NML's Properties would make sense to them also...
ArcelorMittal Says Rio Tinto's IOC Unit Would Be `Natural Fit'
By Dale Crofts
July 2 (Bloomberg) -- ArcelorMittal, the world's largest steelmaker, said it would be interested in acquiring Rio Tinto Group's Iron Ore Co. of Canada unit because the business fits with its operations in eastern Canada.
``If that kind of opportunity arose, I'm sure we'd take a look at it,'' Lou Schorsch, head of Luxembourg-based ArcelorMittal's flat-rolled business in the Americas, said yesterday in an interview in Chicago. ``That would kind of be a natural fit. We share a lot of infrastructure.''
ArcelorMittal is buying iron-ore plants in Canada and Liberia to counter the market power of BHP Billiton Ltd., Rio Tinto and Cia. Vale do Rio Doce. The three companies control about 80 percent of the world's seaborne iron ore and are raising prices to records. London-based Rio Tinto has said it plans to sell as much as $10 billion of assets this year.
Iron Ore Co. of Canada, also known as IOC, is ``a good operation and not on our short list of possible disposals,'' Rio spokesman Nick Cobban said today.
ArcelorMittal said in September it would buy the more than two-thirds of the Wabush Mines iron-ore venture in Canada that it doesn't already own from U.S. Steel Corp. and Cleveland-Cliffs Inc. for about $67 million. U.S. Steel and Cleveland-Cliffs ended talks to sell the stake in March, and ArcelorMittal has asked the Ontario Superior Court to force the transaction. ArcelorMittal is ``very confident'' it will complete the purchase, Schorsch said.
Wabush produces iron-ore concentrate in Newfoundland and Labrador and has port facilities on the St. Lawrence River's north shore, close to the operations of ArcelorMittal's QCM unit.
``Part of why we are interested in Wabush is because QCM is more or less right down the road,'' Schorsch said. ``Also right down the road is IOC that Rio Tinto owns.''
Rio holds a 59 percent stake in Iron Ore Co. and operates the business. Rio is spending about $475 million to expand mining and processing facilities in Labrador West and transportation capacity on the railway linking the mine with the port of Sept- Iles, Quebec.
To contact the reporter on this story: Dale Crofts in Chicago at dcrofts@bloomberg.net.
Last Updated: July 2, 2008 09:54 EDT