Reuters reported that shares of ArcelorMittal South Africa surged more than 5%, after a judge said a politically connected company with no mining experience could not keep a prospecting right it was controversially awarded.

South Africa previously awarded Imperial Crown Trading, a little known firm connected to the family of President Mr Jacob Zuma, the right to prospect for minerals in parts of a mine operated by Kumba Iron Ore.

The unit of the global steel maker said that the ruling would mean that Kumba would have to continue supplying it with iron ore at a discount.

ArcelorMittal South Africa said in a statement that "The judgment of the High Court serves to confirm our view that Kumba unit SIOC remains obliged to supply 6.25 million tonnes of iron ore to us at cost plus three percent in terms of our agreement."

ArcelorMittal and Kumba have been locked in a supply disagreement related to the Imperial Crown Trading dispute.

(Sourced from www.reuters.com)