Arcelor Mittal has agreed a deal with controlling shareholders in China Oriental to allow it to eventually raise its stake in the firm to 73.13%.
Arcelor Mittal is eager to increase its exposure to China, the world's biggest producer and consumer of steel.
China Oriental offers a rare opportunity in a sector still closely monitored by the state, and Arcelor Mittal bought a 28% stake in November.
Shares in China Oriental Group rose sharply in Thursday trade.
Its shares were returning to the Hong Kong market after being suspended in November.
Arcelor is now offering to buy out minority shareholders at up to HK $6.826 ($0.87: £0.42) a share.
Shares in China Oriental moved as high as HK$7.1 before sliding back to HK$6.6, a gain of more than 20%.
Foreign ownership issues
Mittal bought Arcelor in 2006, creating a firm with 10% of the steel market.
The global market for steel has been growing, with especially strong demand from developing countries such as China as they embark on large industrial and building works.
Foreign investors are not allowed to own more than 50% of major steel mills in China.
Non-state owned, foreign-registered China Oriental, though a small player, offers Arcelor Mittal a rare chance of access to the market.
Arcelor Mittal also announced on Thursday that China's Laiwu Steel had decided not to extend an agreement to sell 38.41% of the Chinese steel company to it.
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