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By Francesco Guarascio and Silvia Antonioli
BRUSSELS/LONDON (Reuters) - The European Commission may oblige steelmaker Aperam <APAM.LU>, bidding to buy Outokumpu's <OUT1V.HE> stainless steel plant in Terni, to sell other steel assets if it succeeds, a commission source said.
Finnish steelmaker Outokumpu has to sell the Acciai Speciali Terni (AST) stainless steel mill, one of Europe's most modern, by May to gain approval from competition authorities for the acquisition of Inoxum, ThyssenKrupp's <TKAG.DE> stainless steel branch, and AST was part of the acquisition.
Aperam, floated by ArcelorMittal <ISPA.AS> in 2011, teamed up with Italian steel companies Arvedi and Marcegaglia to place a binding bid last week, and industry sources have said the consortium is the front runner in the race to buy the plant.
The market for stainless steel in Europe is already extremely concentrated, and the Commission would prefer the entry of a new player, the source with knowledge of the situation said.
"It is not to be given for granted that the Commission will give its authorization to the possible sale of the Terni factory to Aperam," the source said.
"A possible solution may well be the imposition of a remedy on Aperam, which already owns several stainless steel mills in Europe," the source added.
Remedies are conditions imposed by the Commission before a company is allowed to proceed with a merger or an acquisition that could affect market concentration in the region.
Outokumpu and Aperam declined to comment on the situation.
Industry sources have also said EU regulators, seeking to avoid anticompetitive market conditions, could make the acquisition more difficult by forcing Aperam to sell assets elsewhere.
Other firms still in the race to buy the plant include U.S. private equity fund Apollo, which also presented a binding bid for the acquisition of the plant last week, and Chinese steelmaker Tsingshan, which placed a non-binding bid, union sources said.
(Editing by Jane Baird)