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LONDON - A frenetic £5 billion ($14.2 billion) bidding war has broken out for the steel group Corus after Brazil's CSN trumped an improved offer from India's Tata within hours.
The Corus board is now backing a 515p-a-share offer, worth £4.9 billion, from CSN. However, Tata, which has already made two offers for Corus, said it was considering coming back with more. Corus also comes with £900 million of debt.
Corus shares closed at 527.25p, up 5 per cent, as investors bet the two predators would continue to fight it out.
Only a few months ago, Corus - the former British Steel - seemed unloved as it touted itself around the world to potential buyers.
Unlike Tata, CSN detailed significant synergy benefits from buying Corus. Analysts said this meant it would have the upper hand in a bidding war with the Indian company.
The logic for the Brazilians is based on supplying low-cost iron ore from its own mines to the Corus plants in the UK and Holland. Under Indian law, Tata is not permitted to export iron ore, the key raw material for making steel.
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