Russia’s Severstal, one of the world’s leading steel and mining companies, said it completed the purchase of Liberia-based Putu iron ore project in a deal to strengthen its position in the global iron ore market.

The company bought the remaining 38.5% interest in Putu from joint venture partner Afferro Mining and its subsidiary, Mano River Iron Ore Holdings Limited. Until recently, Severstal held a 61.5% interest in Putu.

Lybica Holdings BV, a subsidiary of Severstal, has transferred an initial cash payment of $65mn to the seller after signing a sale and purchase agreement, including $55.25mn directly to Mano River and $9.75mn to an escrow account with Royal Bank of Canada until the parties reach an agreement with the Liberian authorities on the amount of tax they should pay.

The Liberian government claimed a 15% tax on the transaction. Neither Afferro nor Severstal believe that such a tax is payable following consultation with Liberian tax advisers and lawyers.