Severstal Increases Stake in Crew Gold (TSE:CRU)

Severstal announced today it has increased its stake in Crew Gold (TSE:CRU) to over 36 percent, after buying about 10 percent of the outstanding shares in the company.

Severstal, which is a Russian-based steelmaker, responded in this way because they are battling Endeavour Financial Corp (TSE:EDV) for control of the company. Endeavour owns close to 43 percent of Crew, and has been buying more recently. Endeavor also holds tree board positions in the company.

Total shares bought by Severstal this time around were about 206 million at C$0.2887. That's a premium of close to 18 percent over Tuesday's close.

Crew was at $0.2650 a share in Toronto at 1:00 PM EDT.

Severstal Says Crew Gold (TSE:CRU) Shares Too High for Tender Offer

Severstal drops bid for Crew Gold shares

Severstal (CHMF.MM) said it is no longer interested in making a tender offer for Crew Gold (TSE:CRU), which had wanted to buy a controlling stake in the company.

Endeavour Bank (TSE:EDV) started acquiring shares in Crew Gold, and now owns about 43 percent of the shares, and has 3 of its people on the board of Crew Gold.

Severstal said the price of Crew Gold shares from the buying of shares by Endeavour has made the deal no longer attractive because of their higher price, and consequently is dropping their pursuit of managing control.

Severstal currently owns 27 percent of Crew Gold shares.