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JOHANNESBURG, April 2 (Reuters) – Africa’s largest
steelmaker ArcelorMittal South Africa could face a fine
of more than 3 billion rand ($390 million)for price fixing,
South Africa’s competition regulator said on Monday.
South Africa’s Competition Commission has asked the
country’s competition court to penalise ArcelorMittal and
smaller competitor Evraz Highveld Steel and Vanadium up
to 10 percent of their annual turnover for collusion.
ArcelorMittal’s turnover for 2011 was 31.5 billion rand
while Highveld reported a turnover of 5.5 billion rand for the
year to end December 2011.
“Evidence before the commission indicates that the steel
producers engaged in concerted practices or had understandings
that Highveld would follow Mittal’s lead on the pricing
mechanism and changes in pricing, including discounts and
transport tariffs,” the regulator said.
The recommendation to the competition court comes four years
after a complaint was filed with the authorities alleging that
Mittal and Highveld adjusted their prices for steel products
around the same time and with similar percentage increases.
ArcelorMittal spokesman Themba Hlengani said that the
company would comment after consulting with its lawyers.
Shares of ArcelorMittal dropped more than 4.4 percent on
Monday to 53.48 rand by 1150 GMT, underperforming the JSE’s All
Share index, which was 0.42 percent up on the day.
ArcelorMittal’s shares were also hurt by news that it had
been excluded from the South African government’s preferential
procurement programme, which is designed to benefit local
manufacturers, and a downgrading by Barclays Capital.
($1 = 7.6745 South African rand)
(Reporting by Sherilee Lakmidas, editing by Ed Stoddard)
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