ArcelorMittal Excluded From Russian Mine Auction

Oct. 5, 2007
Company wants to know why

Mining giant ArcelorMittal was excluded from an auction in Moscow for two Siberian mining assets on Oct. 5 that went to Russia's Mechel for $2.29 billion officials said.

"We were very surprised to have been informed that we did not qualify for participation in the auction," Jean Lasar, a spokesman for ArcelorMittal, said adding that his company was only told of this on Oct. 5. "We are waiting to be told the reasons for this," Lasar said.

ColorProfil, a company representing ArcelorMittal, had applied to take part in the auction but was not authorized by Russia's state property fund, the organizer of the sale, officials said. At the auction, Mechel Invest, a company representing Russian metals and mining firm Mechel, beat out Yakutskaya Ugolnaya Kompaniya, part of the diamond giant Alrosa, for controlling stakes in the two mines.

Mechel CEO Alexei Ivanushkin said in an interview with the Kommersant daily ahead of the sale that the two major coal deposits, Elgaugol and Yakutugol, were "strategic" for Russia.

ArcelorMittal, which is based in Luxembourg, could have used the coal assets "as a means of applying pressure on Russian metals companies" and Russia's "national interests" were at stake, Ivanushkin told Kommersant.

Copyright Agence France-Presse, 2007

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