Mittal makes hostile move for Arcelor

24 April 2008

Netherlands-Based Mittal Steel Launched a Hostile Takeover bid for Luxembourg steel producer Arcelor at the end of January. The cash and shares deal values the company at € 18,6 billion, and is currently being considered by regulators. A decision was expected as CE went to press.

However, the Arcelor board is opposed to the offer and is refusing to hold talks with Mittal. There was also strong opposition to the merger from the French, Belgian and Luxembourg Governments. All three are major shareholders in the company, which was created in 2002 through the merger of steel producers in France, Spain, Luxembourg and Belgium.

Nonetheless, Mittal CEO Lakshmi Mittal has said that the response from Arcelor investors so far has been “overwhelmingly positive.” Mr Mittal has also claimed that he has persuaded the politicians to see the industrial rational behind the deal and has said that the merger will not lead to large scale job losses. The Belgian and Luxembourg Governments are believed to have appointed investment banks to advise them on the deal.

Arcelor is currently the world's second largest steel producer, behind Mittal, and employs 94000 people worldwide. If the merger is successful the group will account for more than 10% of worldwide steel production and will have capacity to produce more than 100 million tonnes of steel a year. According to Mr Mittal, the bid for Arcelor has been driven by Mittal's belief that Europe needs a stronger steel sector to compete with China's burgeoning industry.

Latest News
Piedmont Hoist & Crane acquired
Following the purchase by Mazzella Companies, the North Carolina-based manufacturer will now operate as Mazzella Piedmont.
What are the newest boom trucks in North America?
Boom trucks fill an important market niche.
Epiroc completes purchase of autonomous mining company
Epiroc buys remaining share of OEM agnostic autonomous mining solutions company