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(AMM) Seversal sale talks heat up, blast furnace restart eyed

September 01, 2010 - 20:29 GMT Location: PITTSBURGH

KEYWORDS: Severstal North America , blast furnace , Sparrows Point

Severstal North America is considering restarting the blast furnace at its Sparrows Point, Md., operations earlier than expected as talks aimed at selling that facility and two others heat up.

The company received five separate bids for three U.S. plants it has up for sale, four of which met required bid conditions, according to sources familiar with the process. However, all four bids have been deemed by Severstal to be "low-ball bids" and thus far are unacceptable offers for the assets in Sparrows Point; Warren, Ohio; and Wheeling, W.Va.

"They got four bids that met the criteria they set out that the offers be for all three plants," one source said. "But that doesn't mean anyone intended to run all three. The fifth offer was from someone who wanted just one mill, and that one was rejected."

Sources identified three of the bidders as Renco Group Inc., New York; Aurora Capital Partners LP, Los Angeles; and Ukrainian business conglomerate Metinvest Holding TOV, working in some form with Optima Fund Management, New York. Another unnamed private equity fund whose...

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