The stainless steel sector in Europe needs to consolidate to help reduce overcapacity, largest steelmaker ArcelorMittal (MT) said Wednesday.

The company said it's considering a spin-off of its stainless steel division.

"It needs consolidation because we have a situation of overcapacity in Europe," said chief financial officer Aditya Mittal. He declined to comment on whether a spin-off could be a vehicle for such consolidation.

"We have not been successful in consolidation in the past," Mittal said, adding that a spin-off will thus help the company focus on products for the stainless steel sector and "maximizing value."

The spin-off could happen as early as next year, Mittal said.

-By Devon Maylie; Dow Jones Newswires; (4420) 7842 9483; devon.maylie@dowjones.com
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