Mittal Steel South Africa, the largest steel manufacturer in Africa, has purchased two idle steel mills in Mozambique. The $11.5 million (R90 million) acquisition of Companhia Siderurgica de Mozambique (CSM) and Companhia Mozambique de Trefiloria (Trefil) a rod mill and a wire-drawing facility respectively is part of a strategy to expand into sub-Saharan Africa.

Under the terms of the purchase agreement with the government of Maputo, the company will not only restart production at the two mills but also help develop other fields including coal and iron ore mining. Mittal currently has an annual output of seven million tonnes but it is embarking on a R9 billion expenditure plan to increase production to nine million tonnes by the end of 2008, Johannesburg daily Business Day reports.