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Credit Suisse Raises Stake in Canadian Steelmaker Dofasco

Dec. 28 (Bloomberg) -- Credit Suisse Group has more than doubled its stake in Dofasco Inc., a Canadian steelmaker that's the target of a takeover fight between Arcelor SA and ThyssenKrupp AG.

Credit Suisse First Boston Canada Inc. and CSFB LLC have acquired 2.9 million shares since Nov. 23, raising the bank's stake to 4.23 million shares, according to a release distributed by Canada NewsWire today. The bank didn't say what it paid for the shares and spokesman Duncan Webb didn't immediately respond to a request for comment.

``The common shares were acquired for investment purposes only and not for the purpose of influencing control or direction over Dofasco,'' Switzerland's second-biggest bank said in the statement.

Credit Suisse's 5.5 percent stake in Dofasco is worth C$274 million ($235 million) at the current price. Dofasco shares rose 15 cents to C$64.86 at 10:05 a.m. in trading on the Toronto Stock Exchange.

Shares of Hamilton, Ontario-based Dofasco have surged 47 percent since Nov. 22, the day prior to Arcelor's bid for the company. Arcelor, the world's second-biggest steelmaker, made a hostile C$4.3 billion bid for Dofasco. ThyssenKrupp, Germany's biggest steelmaker, topped the offer Nov. 28 with a C$4.8 billion bid backed by Dofasco.

Arcelor increased its offer to C$4.9 billion, or C$63 a share on Dec. 23. ThyssenKrupp may respond with a further increase, the Financial Times Deutschland reported today, citing unidentified people in the industry.

Steelmakers are merging to gain clout with iron ore suppliers, which are charging record prices this year. Arcelor Chief Executive Officer Guy Dolle, who is losing ground to larger competitor Mittal Steel Co., is focusing on growing outside Europe, where the company sells 75 percent of its steel.