Reports: Severstal Receives Bids For Its North American Unit

(RTTNews) - Russian steelmaker OAO Severstal (SVST.L) has put its North American operations for sale and received bids from at least two potential buyers for those assets, according to media reports over the weekend.

United States Steel Corp. (X) and Brazil's Companhia Siderurgica Nacional SA (SID) have reportedly bid for Severstal's North American assets. According to a report in the Wall Street Journal on Friday, Severstal may receive $1.5 billion or more from a sale of those assets.

Severstal's North American operations consist of two steel plants in Dearborn, Michigan and Columbus, Mississippi.

Severstal, Russia's second-largest steelmaker, acquired the Michigan plant in 2004 as part its takeover of Rouge Industries in 2004 for $285.5 million. The company has since invested more than $1 billion in upgrading the facility. US Steel is said to be most interested in acquiring the Michigan plant as it is near its own facility.

The Mississippi plant, a minimill that makes steel out of scrap metal, was started by Severstal in 2007.

Severstal sold three unprofitable plants in Maryland, Ohio and West Virginia to Renco Group in 2011.

In mid-April, Severstal said that production of crude steel for the first quarter rose 3 percent from the year-ago period to 3.93 million tonnes, with 2 percent growth in its Russian steel division and 4 percent increase in the North American division.