Tata Steel of India and rival CSN of Brazil battled for control of Anglo-Dutch steelmaker Corus in a takeover auction which pits two emerging economic superpowers against each other for a major chunk of the European steel industry.

The auction for the former British Steel, which kicked off at 1630 GMT, was due to reach its climax on Wednesday or Thursday when a winner was expected to be declared.

The multi-billion-dollar showdown illustrates the growing economic clout of India and Brazil, as Tata and CSN seek to compete more effectively with world number one Arcelor Mittal in the rapidly-consolidating steel sector.

The winner will become the fifth-largest steel player in the world with annual steel output of some 25 million tonnes per year, and will employ between 50,000-90,000 people worldwide, according to estimates from the two bidders.

Britain's Takeover Panel imposed the auction on Tata and Companhia Siderurgica Nacional (CSN) last Friday following a three-month takeover tussle.

Corus had last month backed bids from both Tata and CSN. The Brazilian group offered about 5.8 billion pounds (8.6 billion euros, 11.3 billion dollars) after Tata had tabled an offer of about 5.6 billion pounds.

Both bids include debt worth about 900 million pounds. Tuesday meanwhile had marked a deadline for CSN and Tata to revise those bids.

CSN has said that its deal would give Corus access to increasing quantities of low cost semi-finished steel for further processing across downstream plants in Europe, and provide opportunities for significant savings.

For its part, Tata has said that a combination with Corus would create a high quality, low cost, attractive growth platform in Asia combined with a leading European steel player.

Corus had recommended in December that shareholders accept the latest CSN bid which was pitched at 515 pence per share, compared with Tata's offer of 500 pence per share.

The share price in Corus closed 0.54 percent higher at 563 pence on Tuesday, after earlier striking 566.50 pence -- which was the highest level since March 2000.

The British capital's leading share index, meanwhile, ended just 0.03 percent higher at 6,242.00 points.

The auction process will last around ten hours and comprise nine bidding rounds. A result is anticipated at around 0300 GMT on Wednesday morning.

But if bidding has not been completed by then, the auction will be suspended until 1630 GMT on Wednesday, concluding early the following morning.

Corus, which was spawned by the 1999 merger of Dutch firm Hoogovens and British Steel, is Europe's second-largest steel maker and the world's ninth-largest, producing around 18 million tonnes per year.

CSN, which had attempted to merge with Corus back in 2002, is Brazil's third biggest steelmaker, with its main plant in Volta Redonda, Rio de Janeiro.

Tata Steel, part of the giant Tata conglomerate, is the biggest private steel firm in India and ranks as the 56th-biggest global steel player.

Speculation has swirled around Corus following the Arcelor Mittal blockbuster, led by Indian tycoon Lakshmi Mittal, which created the world's largest steelmaker in a 32.4-billion-dollar deal. Arcelor Mittal is registered in The Netherlands and run from London.