Investors are betting that Mittal has not given up on buying Arcelor

The controversial buyback was seen as part of Arcelor's efforts to fend off a hostile takeover by rival Mittal Steel.

Instead, Arcelor wants to merge with Russia's Severstal, a move that is proving unpopular with investors.

Analysts said there was now a good chance that Mittal would raise its 25bn-euro ($31bn; £17bn) bid, despite having said earlier that it would not.

Mittal is still in talks with Arcelor, though shareholders who were hoping the two sides might hammer out an agreement on the sidelines of a steel conference in New York were disappointed by Mittal chief executive Lakshmi Mittal.

"There's no meeting planned," Mr Mittal said on Tuesday.

Fork in the road

Even so, there is plenty of pressure on Arcelor to decide upon its future, and its decision to cancel the buyback meeting has fanned speculation about the direction the company plans to take.

The Luxembourg-based firm said Wednesday's meeting had been postponed "in the light of the current discussion between Arcelor and Mittal, and in order not to impair any solution for the future of Arcelor".

Arcelor said the outcome of discussions remained "uncertain" and the company would have needed two-thirds of all shareholders to support the buyback.

The largest single shareholder, Carlo Tassara International, has previously said it would vote against the 44 euro-per-share offer from the company.

Arcelor denies the buyback is designed to block the Mittal bid, which expires on 5 July.

It said it was designed to reward shareholders and that it still planned to go ahead with the move.

More needed

At the same time, Arcelor is also trying to convince shareholders that the best way for it to survive would be to join up with steel firm Severstal.

Some Arcelor investors are concerned about plans to give the Russian firm's boss, Alexey Mordashov, a 37.5% stake in the merged company, which would be the world's biggest steelmaker with a turnover of about 46bn euros.

Strong growth in developing nations has driven steel prices higher

On Tuesday, a US shareholder advisory group warned against Arcelor merging with Severstal, claiming that investors had not had enough time to digest the terms of the deal.

The Institutional Shareholder Services also voiced concerns that not all the facts had been revealed.

It said that while the deal seemed simple on the surface, "the evidence strongly suggests otherwise".

Arcelor has convened a meeting on 30 June to give shareholders the chance to oppose the move to buy Severstal, and said it would abandon the move if 50% of shareholders voted against it.

Mittal, the world's largest steel firm, with headquarters in the Netherlands, first launched its hostile bid for Arcelor in January, and has since then upped its offer.