Brussels has for almost a year been probing the $500 million deal for MMG, whose largest shareholder is a Chinese state-owned company, to take over two ferronickel-producing sites in Brazil and two additional projects in the country.
"The European Commission has informed MMG Limited of its preliminary view that its proposed acquisition of Anglo American's nickel business may restrict competition in the market for low-carbon ferronickel," the EU's executive said.
"In particular, the commission is concerned that, following the transaction, MMG could divert low-carbon ferronickel supply away from European markets, leading to higher costs in European stainless steel production."
The EU said the statement of objections did not prejudge the outcome of the overall probe and that MMG could now reply to the concerns raised.
Founded in 1917 in South Africa by German-born industrialist Ernest Oppenheimer, Anglo American is one of the world's largest mining companies, listed in both London -- where it is headquartered -- and Johannesburg.
The group has been undergoing a transformation, with plans to divest from several business units such as metallurgical coal, platinum and diamonds in South Africa to refocus on copper, premium iron ore and fertilisers.
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