Lakshmi Mittal, the Indian-born steel baron whose donations to the Labour Party proved an embarrassment to Tony Blair, is expected this week to secure the $560m (£335m) purchase of Poland's largest steel group, Polski Huty Stali (PHS).
The bid, being made through Mr Mittal's London based but Dutch-registered LNM Holdings, has been recommended by a committee of Polish ministers in preference to a rival offer from the American group US Steel. A final decision is to be made by Treasury minister Piotr Czyzewski tomorrow. Despite intense lobbying by the US government, culminating in a recent visit to Warsaw by President Bush, Mr Czyzewski is expected to ratify the committee's decision.
Mr Mittal has offered to invest $150m and take on PHS's $410m of debts in exchange for a 75 per cent stake in the group. The troubled PHS is the largest steel maker in Poland but has recently been struggling because of high manning levels and low global steel prices.
LNM is also bidding for another state-run steel group in Poland, Huta Czestochowa, which is in bankruptcy. If Mr Mittal wins his bid for Huta as well as PHS he will control up to 85 per cent of Poland's steel-making capacity.
Mr Mittal cited consolidation in the Polish steel industry and the technical skills of PHS as reasons for his decision to bid for the company. He added that Poland's forthcoming membership of the European Union would put companies such as PHS on an equal footing with the likes of Corus.
LNM, which claims to be the world's second-largest steel maker, with annual revenues of £8bn, has been in talks with Corus about a possible purchase of some of the troubled Anglo-Dutch steel group's assets. However, these talks have not been particularly productive as the steel assets Corus wants to sell are mainly in the UK, where it is losing vast amounts of money.
Mr Mittal's businesses are mostly in developing countries. In addition to plants in Mexico, Trinidad, the US, Canada, Indonesia, Kazakhstan, Germany and Algeria, LNM has a joint venture in South Africa, a plant in the Czech Republic and an operation in Romania.
It was the deal to buy the Romanian business, Sidex, that brought Mr Mittal into the spotlight. Mr Blair mentioned the Sidex deal in a letter he sent to the Romanian president, and it later emerged that Mr Mittal had made a substantial donation to Labour before the last general election.
LHM's major rival in eastern Europe, US Steel, is not free from controversy either. Its purchase of a steel business in Serbia was attacked because a consortium of banks, led by BankAustria, was essentially cut out of the deal and left with over £100m of losses.Reuse content