Russia's Severstal in talks to buy ArcelorMittlal's assets in France

Severstal, Russia's third-largest steel producer, is in talks to buy ArcelorMittlal's assets in Florange in France, Les Echos today reported, citing unidentified sources close to the matter.

Severstal plans to buy two furnaces that were closed by the Luxemburg-based steel giant at Florange.

The two furnaces producing high-tech steel, have been idled for the last 14 months. The temporary closure of the two units, announced earlier by the company, had become a political issue in France and the French government had been making attempts to avoid its permanent closure.

ArcelorMittlal, the world's largest steelmaker had implemented a strategy of temporary idling the Florange furnaces whilst waiting to see if the economic situation would improve in Europe. However after four years of challenging conditions, the steelmaker had said that it was clear that there would be no swift return to pre-crisis levels.

In early October, ArcelorMittal announced that it would permanently close the two furnaces, which affected around 630 workers out of the 2,500 employed at the site.

''Given the continued economic difficulties affecting the French and European economies, the company wishes to propose to permanently close the liquid phase and concentrate efforts and investment on the high-quality finishing operations,'' Arcellor Mittal had then said.