Evraz Said in Talks for Donbass Assets

Evraz Group, the country's biggest steelmaker, is in talks to acquire assets from Ukraine's Industrial Union of Donbass, two people familiar with the situation said Thursday.

Evraz has visited steel plants owned by Donbass and discussed ways to buy them, said the sources, who declined to be identified because the talks are confidential.

"Evraz may be interested in the Alchevsky and Dneprovskiy steelworks," said Konstantin Golovko, an analyst at Renaissance Capital in Kiev. The plants "do not have vertical integration and need coal and ore at good prices. Evraz has everything Donbass needs."

Combining Evraz with Donbass' two steel mills in Ukraine's Donetsk region would create a company producing more than 25 million tons of steel per year. Evraz spokesman Alexei Ivanov declined to comment.