The worldÔÇÖs largest steelmaker, ArcelorMittal, is reportedly exploring a joint venture spinoff of its stainless steel business worth an estimated ┬ú1.82 billion.
According to the Financial Times, the Luxembourg-based company has held talks with South Korean firm Posco, the worldÔÇÖs sixth-biggest steel company, and Outokumpu of Finland, one of Europe's leading stainless steel firms.
ArcelorMittal was formed in 2006 when Mittal Steel purchased Arcelor for £23.2 billion. Almost all of its existing stainless steel business, which includes plants in France, Belgium and Brazil, came with Arcelor as part of the merger.
Stainless steel, most commonly used in precision engineering, kitchen goods and car exhausts, is relatively high-cost compared to other forms of steel. The stainless side of the industry is currently seen to be suffering from a high degree of overcapacity.
According to the Financial Times, ArcelorMittal is evaluating "various options" related to its stainless steel division but has "no intention" of disposing of the business completely.
If a joint venture were to take place, cuts in production would be likely to lead to job losses in Belgium and France.
The stainless steel division of the company employs 11,000 people.
In 2008 the companyÔÇÖs output represented approximately 10 per cent of the worldÔÇÖs steel production.
Neither Posco nor Outokumpu have confirmed discussions with ArcelorMittal, the newspaper said.
