Baotou's talks with Mittal fail
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Update time : 2015-03-11 21:17:08
Mar. 7, 2007 (China Knowledge) – China's Baotou Iron and Steel Group has ended talks with Arcelor Mittal to sell a stake to the global giant, said Baotou chairman Lin Donglu on Tuesday.
According to Lin, talks failed as Arcelor Mittal wants a 50% stake in the joint venture. China's steel industry regulations do not allow overseas steelmakers to have a controlling stake in a joint venture.
In addition, the failed talks comes after China's largest steelmaker, Baosteel Group <600019>, expressed interest in Baotou. Lin said that talks with Baosteel are still ongoing, although foreign companies have not been ruled out.
According to Reuters, Baosteel has played an aggressive role in consolidating China's fragmented steel industry, while China is keen to keep its rare earth resources, which have military applications, in Chinese hands.