EC nod for Swedish steel link

(First Edition)

BRITISH STEEL'S joint venture with Avesta of Sweden has been given the go-ahead by the European Commission. The companies plan to form a stainless steel manufacturing and distribution company, creating one of Europe's largest stainless steel groups, writes Mary Fagan.

The venture, Avesta Sheffield, will have a turnover of pounds 1.2m and employ 9,000 throughout Europe. It will be chaired by David Grieves, a main board director of British Steel, and will have its headquarters in Stockholm.

British Steel will own 40 per cent of the company, and will transfer to it almost all of its stainless steel production and distribution activities.

The Commission said it had cleared the deal because market share for cold-rolled stainless steel products was under 20 per cent in both cases. A spokesman for the Commission said that although the deal was cleared under the EC's merger regulations, it still had to be cleared under Coal and Steel Community rules. The venture cannot go ahead until this clearance is obtained. British Steel said that it was confident the venture would proceed as planned.