Reuters reported that Switzerland based steel and coal trading house Carbofer is close to finalizing the sale of a substantial stake to Indian iron ore trader Psons.

, in a bid to raise capital and expand steel raw materials trading, the company CEO told Reuters on Thursday.

Mr Piero Piccolo CEO of Carbofer told Reuters that “We can confirm that Carbofer board of directors and shareholders has decided more than 6 months ago to explore the possibility of a capital increase. We prefer a capital increase with strategic partners, traders or entities in raw materials and steel today.”

He added “We have been discussing with Psons and doing something but the transaction is not closed, we are talking, we are actively engaged. We would like to see it closed by the end of the year.”

Carbofer expects that an alliance with Agarwal and a cash injection would enable it to expand its business across the spectrum of commodities in which it trades, including thermal coal into the Indian market.

Honk Kong based trading house Psons is controlled by the Indian Agarwal family and focuses on iron ore trading, mainly in Asia. It has done business with Lugano based Carbofer in the past and has lately put money into the Swiss company's trading operations.

Carbofer's current share capitalisation is about USD 40 million to USD 50 million. Russian entrepreneur Mr Alexander Katunin, the majority stakeholder of the Swiss trading house and a former co owner of Russian steelmaker Evraz, would be intentioned to sell its Carbofer shares to focus on other businesses.

(Source form Reuters)