updated 1/31/2007 8:23:09 AM ET 2007-01-31T13:23:09

India's Tata Steel outbid Brazilian rival CSN on Wednesday to take over European steelmaker Corus Group PLC, after offering $11.3 billion for the acquisition, an official at the Indian company said.

The winning bid values shares of London-based Corus at 608 pence each, said the official at Tata Steel Ltd.

The official didn't want to be named because Britain's takeover panel, which ordered the auction, has yet to make a formal announcement.

The U.K. Takeover Panel called the auction to end a bidding war after Brazil's Companhia Siderurgica Nacional SA last month made a 4.9 billion pound ($9.6 billion) bid for Corus that topped a sweetened offer of about $9.2 billion by Tata Steel.

The panel presided over the auction process that started late Tuesday and continued for several hours until CSN bowed out, the Tata Steel official said.

Officials at CSN and Corus could not be immediately reached for comment.

The European Commission had earlier cleared both Tata Steel and CSN as eligible to acquire Corus, which has been searching for a business partner with assets in low-cost countries as rising raw material and energy costs in the Britain and the Netherlands chip away at profits.

A successful acquisition of Corus will transform Tata Steel — currently ranked 56th in the world in terms of output — into a global player in the metal business.

A combined Tata-Corus would have annual steel production of 25 million tons, making it the world's fifth-largest steel producer.

It would also continue the consolidation in the global steel industry after Mittal Steel Co. NV's deal to acquire Arcelor SA to create a powerhouse which has a 10 percent share of the market.

Corus — formed in 1999 when British Steel and Koninklijke Hoogovens of the Netherlands combined — has plants in Britain, the Netherlands, Germany, France, Norway and Belgium. It sells steel and aluminum products worldwide and employs 47,300 people.

Copyright 2007 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.


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