Russia: Severstal to give up on Arcelor merger

Citing two unidentified sources close to the Russian steelmaker, the paper said Mordashov has admitted he lacks the resources to improve his offer for Arcelor and win the battle with Mittal, whose improved offer, worth US$31.8 billion, was approved by the Arcelor board Sunday after five months of resistance.

Photo: Russia: Severstal to give up on Arcelor merger

Russia: Severstal to give up on Arcelor merger

A spokeswoman for Severstal declined to comment on the Vedomosti report.

On Wednesday, French lawmakers had suggested that Mordashov was intent on coming up with a revised Arcelor deal before a key shareholder meeting Friday, though it was far from clear if he could manage this in time.

On Monday, a person close to the deal said that Dutch bank ABN Amro had approved a multibillion euro facility for Mordashov, suggesting that he was preparing a war chest to counter Mittal's offer, the AP reports.

While resisting the Mittal bid, Arcelor committed to a deal with Mordashov, which would have seen him become the largest Arcelor shareholder in exchange for his 90 percent stake in Russian steel maker OAO Severstal.