March 4, 2010 / 1:07 PM / 9 years ago

UPDATE 1-Russia Severstal buys remaining 20.2 pct of Lucchini

* Price of 20.2 percent stake in Lucchini not disclosed

* Russian firm, owner Mordashov bought majority in 2005

(Adds background on put option, sale talks)

MOSCOW, March 4 (Reuters) - Severstal (CHMF.MM), Russia’s largest steel producer, said on Thursday it acquired the remaining 20.2 percent of Italy’s Lucchini SpA from the Lucchini family in order to take full control of the company.

Severstal, controlled by billionaire Alexei Mordashov, did not say how much it paid for the stake.

Italian steel union officials told Reuters last month that Severstal is examining five potential offers for its loss-making Italian business. [ID:nLDE61G297]

Severstal has confirmed it is pursuing several options for Lucchini, including a possible sale to a strategic partner.

According to analysts, the Lucchini family held a put option to sell its stake to Severstal for 160 million euros ($218.9 million) starting in April 2010.

However, a report in the Italian press earlier this week said Severstal paid 100 million euros for it.

Analysts also said Lucchini has $1.4 billion of debt.

“We value the Italian division at a maximum of $1bn of EV (enterprise value),” Otkritie analysts wrote last month. “At the same time Lucchini has a total debt of $1.4bn, which means that the implied market cap of the Italian division is negative and the sale of the division would positively impact the Severstal group’s fair equity value.”

Lucchini’s main plant in Piombino, Italy, has an annual production capacity of 2.5 million tonnes of steel.

It’s Ascometal facility has an average yearly output of 1.2 million tonnes of steel.

Severstal and Mordashov acquired a majority in the company in 2005, and its results have been consolidated since 2006. ($1=.7310 Euro) (Reporting by Alfred Kueppers; Editing by Jon Loades-Carter)

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