Mumbai: The board of US steel maker Esmark Inc will decide whether to accept a takeover offer from Russian metals giant OAO Severstal by Friday, its chairman and chief executive Jim Bouchard said.

Severstal's bid, worth about $1.24 billion, is backed by the United Steelworkers union, which had threatened to block the offer from rival Indian bidder Essar.

Essar said it was considering raising its bid after Esmark's largest shareholder backed the Severstal offer.

Franklin Mutual Advisers, which owns about 60 per cent of Esmark's shares, said in a regulatory filing that it tendered all its shares into the Severstal offer because the United Steelworkers is opposed to the Essar bid.

Both Severstal and Esmark have offered $17 per share for Wheeling, West Virginia-based Esmark, which owns steelmaker Wheeling-Pittsburgh.

Essar, meanwhile, has loaned Esmark $110 million to help it avoid default. It has also proposed $525 million spending on Esmark's plants in West Virginia and Ohio over the next five years.

Although he did not elaborate on the takeover proposals, Bouchard said the company's board, which had agreed in April to the terms of an Essar takeover, would examine the Severstal bid "and report back on or before this Friday, June 13."

Esmark reported a first-quarter net loss of $15.8 million, compared with a net loss of $200,000 a year earlier.

But the company said the results were not comparable because this year's were the first to combine Esmark Steel Service Group and Wheeling-Pittsburgh following their November 2007 merger.

Net sales for the first quarter totaled $600.1 million on shipments of 789,164 tonnes, with an average selling price of $760 per tonne, Esmark said.

For the second quarter, steel shipments are expected to fall by 2 per cent, but average prices are expected to rise to $925 per tonne.

With "a dramatic improvement over pre-merger results" and better results in the second quarter, Esmark expected ''to be EBITDA and net earnings positive," Bouchard said.

Although costs of raw material were expected to add $125 to the cost of a ton of steel, it would still result in net margin improvements of $40 per tonne, he said.

Esmark expects second-quarter EBITDA to increase by $30 million over the $11.4 million in the first quarter.