M A I N   N E W S

Mittal clinches Arcelor deal
L.N. Mittal to be co-chairman with 45 pc stake

Luxembourg, June 25
In a mega deal that would create the world’s largest steel entity, three times bigger than the nearest rival, Arcelor SA today accepted the improved takeover offer from India-born L.N. Mittal’s group, ending a five-month long battle between the industry giants.

The European steel maker’s board accepted the bid from the world’s largest producer after Mittal raised the initial offer of 35.37 (Rs 2,051) Euros per share of Arcelor to 40.37 Eruos per share.

Immediately after the marathon over eight-hour-long meeting of Arcelor Board, a Mittal Steel spokesman while confirming the merger deal said: “We have always sought a recommended merger in the interests of stakeholders. We are delighted that is what we have now achieved.”

Although Arcelor is yet to make a formal statement, sources in the know said the new entity would be christened Arcelor Mittal.

Stating that Arcelor had agreed to a takeover offer from Mittal Steel, Luxembourg Economy Minister Jeannot Krecke told reporters: “We are very happy with the situation,” according to a Bloomberg report.

The revised offer of 40.37 Euros per share is a bonanza for shareholders of Arcelor, whose scrip was worth 26 Euros on January 26, a day before Mittal launched his bid.

The steel tycoon Lakshmi Mittal will have 45 per cent stake in the new firm and he will be co-chairman with Joseph Kinsch.

Krecke was quoted as saying that Luxembourg, which holds 5.6 per cent stake in Arcelor, would be a winner in the transaction.

According to available reports, the decision would now be put before Arcelor shareholders for approval.

Even as Arcelor Board was debating the offer, Mittal Steel hurriedly called its board meeting in London, presumably to discuss the feelers it was getting from Arcelor.

Arcelor’s 18-member board ended more than eight hours of talks at about 7 pm at the company’s chateau in Luxembourg, its second meeting in five days, Bloomberg said quoting Arcelor spokesperson Luc Scheer.

While weighing Mittal’s offer, which was till recently considered as unfriendly and hostile by its acquisition target, Arcelor Board also discussed the merger with Russia-based Severstal.

Though Arcelor management gave a thumbs up to the offer from the Russian company, controlled by oligarch Alexei Mordashov, it was opposed by many shareholders.

Arcelor, for the past five months had spurned advances by Indian-born billionaire Lakshmi Mittal, whose Netherlands-based company, the world's largest steel producer, has put forward an offer currently valued at 23.93 billion euros ($30 billion).

Mittal had launched his bid to takeover Arcelor on January 27. A merger of the two top steel makers would create a company with nearly a 10 per cent share of global production, employing more than 320,000 persons. — Agencies