LONDON (Dow Jones) - French steelmaker Arcelor SA on Wednesday said it plans to launch a C$4.3 billion ( $3.66 billion ) hostile bid for Canada's Dofasco Inc. as it seeks to expand its share of the North American automotive market.

Arcelor will offer C$56 a share, a premium of around 27.3% to Dofasco's closing price on Nov. 22, and a 46% premium to its closing price on Nov. 10 , the last day of trading before press reports of a potential offer emerged, Arcelor said.

"Dofasco's leadership in the North American automotive market is highly complementary with Arcelor's strategy to expand its foothold in this significant market," Arcelor Chief Executive Guy Dolle said in a statement.

Dofasco makes rolled galvanized and tinplated steel for use in the automotive industry.

Arcelor shares were last down 1.5% in Paris .

The offer, which would be Arcelor's largest acquisition in North America to date, requires two-thirds of the Hamilton, Canada- based company's shares for the transaction to succeed.

Dolle said he believes intense international consolidation in the global steel industry makes the combination of Dofasco with another player inevitable.

"Canadian steel producers, regardless of their current competitiveness, are not immune to the forces driving consolidation around the globe. For Dofasco, the question is not if it should join forces with another industry player, but when, and with whom. We strongly believe that Arcelor is the best partner for Dofasco and that this is the right time," he said.

The two companies are no strangers to each other: they already have a joint galvanizing plant, DoSol Galva Limited Partnership.

Rising steel prices due to surging demand from China have left steelmakers with cash to spend. Earlier this month Dolle earmarked as much as 5 billion euros for acquisitions.

(END) Dow Jones Newswires

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