Pechiney poised to revive Corus deal

FRENCH metals group Pechiney is expected to revive plans to buy Corus' aluminium business, in an attempt to foil a hostile takeover by Canada's Alcan.

Corus said Pechiney has exclusive negotiating rights over its aluminium interests until 23 October, the anniversary of its stalled e750m (£527m) offer, and that there has been regular contact.

Such a purchase by Pechiney would trigger European Commission competition scrutiny, and change the scale of the group Alcan is bidding for. It is currently offering e3.49bn for Pechiney.

Corus declined to discuss the nature of the latest contacts with Pechiney, but said it was aware of suggestions that the deal might be rekindled.

With Frenchman Philippe Varin, former head of Pechiney's aluminium business, now chief executive of Corus, contacts with Pechiney headJean-Pierre Rodier could scarcely be cosier.

A Dutch court blocked the aluminium sale in March after the Corus's Dutch supervisory board objected, fearing the proceeds would be swallowed by UK steel losses.

But Varin has now spelled out plans to stem losses in the UK steel business through closures and restructuring. 'Whether that would make a difference to the attitude of the supervisory board remains to be decided,' said Corus in London.