ArcelorMittal buys stake in steelmaker China Oriental Group

ArcelorMittal, the world's largest steelmaker, bought a minority stake worth US$647 million in China Oriental Group, the Financial Times reported. The latter is a Hong Kong listed company whose main asset is a steel mill in northern China's Hebei province that produced 3.62 million tons of steel last year. ArcelorMittal's 28% stake makes it the second largest shareholder in the company, which is one of the few listed Chinese steel companies with no state ownership. It bought its stake at HK$6.14 a share, a 14% premium over China Oriental's last traded share price. ArcelorMittal bought the shares from Diana Chen of Pioneer Metals Group, who was disposing her stake after a failed takeover attempt. ArcelorMittal is in the midst of a US$35 billion spending spree to boost its output capacity globally. In 2005, it was the first foreign firm to own a stake in a Chinese company when it bought 33% of Hunan Valin Steel Tube and Wire.