WITHIN hours of paying £30m for striker Andriy Shevchenko, Chelsea Football Club owner Roman Abramovich last night had a steel firm employing 3,000 North-East workers in his sights.

The Russian billionaire was said to be in talks with Corus over buying a stake in the Anglo-Dutch steel company.

Reports in Russia said he had started negotiations with the steel firm over taking a minority share of the company.

Corus described the report as speculation, but the rumours were well-received in the City with the Corus share price rising by three per cent yesterday.

Prior to the Corus development, Mr Abramovich was already in talks with Evraz Group, Russia's largest steelmaker, over taking a 40 per cent stake in the company.

According to a report in the Russian business newspaper Kommersant yesterday, a deal for Corus could see Mr Abramovich exchange shares between the companies.

That would give him a key stake in Corus while Corus would get cheaper raw materials from Russia. The reports follow speculation in March that Corus was in merger talks with Evraz.

Analysts expect further consolidation of the steel industry after French firm Arcelor last month agreed a deal with Russian steel magnate Alexei Mordashov to buy his 89.6 per cent stake in Severstal.

The move from Arcelor came as it fought off a hostile approach from the world's biggest operator Mittal Steel, owned by the UK's richest man Lakshmi Mittal.

The moves have sent shares in Corus soaring as investors pin their hopes on the company coming into the bid spotlight.

Corus, which was set up through the merger of British Steel and Dutch group Hoogovens in 1999, employs 24,000 people in the UK at locations including Teesside, Scunthorpe, in Lincolnshire, Rotherham, South Yorkshire, and Port Talbot, in Wales.

It is the world's eighth largest steel operator by volume.

Yesterday, the steelmaker reported a fall in profits in the three months to the end of March, but said the outlook was positive, with steel selling prices continuing to rise.