* Brazilian company makes 86 mln euro bid -source
* Plans to invest 150 mln euros in business
* Gerdau aiming for 15 pct of Europe's speciality steel market
* Court reviews bids Wednesday, decides this month (Adds detail on Gerdau and French bids)
PARIS, May 12 (Reuters) - Brazil's Gerdau, the largest steelmaker in the Americas, joined the battle for the assets of bankrupt French engineering steel manufacturer Ascometal with an 86 million euro ($118 million) bid and pledges to invest heavily in the firm, a source close to Gerdau told Reuters on Monday.
The source said Gerdau, which has a market capitalisation of $10.4 billion and employs 45,000 peope, is interested in Ascometal's industrial base close to the key German market, especially its operations in northeastern Hagondange and Dunkerque on the northern coast.
"Our target is to create the European market leader in speciality steels, with a 15 percent market share," he said.
The Brazilian steel giant would rehire 1,585 of Ascometal's workers and take on an extra 166 people, of which 146 would be in Dunkerque and 20 in Hagondange.
Before the bankruptcy, Ascometal employed 1,900 people at six plants in France. The supplier of specialist steel products to the automotive, engineering and oil sectors had sales of 969 million euros in 2011.
A group of French investors and two private equity groups linked to Ascometal's former owners and financiers have also filed bids with the Nanterre commercial court.
Gerdau's 86.3 million euro ($118.71 million) bid includes 44.3 million euros for the acquisition and an extra 42 million euros to assume various Ascometal liabilities. It would also invest 150 million euros in the business over the next five years, the source said.
The source said that Gerdau would take over all Ascometal's plants apart from the one in Cheylas in the Isere region and promises not to sell or close any sites over the next seven years. At the Ascometal site in Fos-sur-Mer, which is working below capacity, Gerdau would rehire 300 workers and develop its activity by transferring part of its Spanish activities.
The French group around Frank Supplisson, who was deputy-chief of staff to former finance minister Christine Lagarde, said in a statement on Monday that its bid includes 55.5 million euros in capital and 40 million euros in long-term debt.
It also confirmed it would hire all Ascometal's industrial staff, take over all its plants and invest 135 million euros over the next four years. Nordic speciality steelmaker Ovako has taken a 10 percent stake in the French group.
Former Ascometal shareholder Apollo Global Management and investment fund Anchorage, backed by Ascometal's former financiers, have also entered bids but have provided no details.
The Nanterre commercial court is due to review the bids on Wednesday and expected to make a decision before the end of May. ($1 = 0.7270 Euros) (Reporting by Geert De Clercq; Editing by David Goodman)