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| HOME >> Topics List >> January, 2006 >> 31 (Tue) |
| World Top Mill's Attempt To Takeover Its Rival Shakes Steel Industries |
| Arcelor rejects takeover offer by Mittal qualifying it as a hostile bid |
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Arcelor announced that its Board of Directors unanimously decided January 29 to reject the unsolicited proposal made by Mittal Steel on the 27th attempting to take over Arcelor, and that the Company would study best measures to be taken from now on. After a thoroughgoing reviews and analyses of the proposal, Arcelor Board has swiftly concluded that Arcelor and Mittal Steel do not share the same strategic vision, business model and values. The Board expressed its concern about serious consequences that could come up on the group, its shareholders, employees and customers, in case Mittal Steel's proposal results positive. Mittal Steel's takeover bid to Arcelor for a total consideration of a huge 18.6 billion euro (about 2,600 billion yen) took world steel industries by surprise. The price nearly equals to the total stock value of a Japanese top steel company. "The amount can include liabilities with interest, so it would actually represent a price in excess of 3 trillion yen", a person concerned of a Japanese steel company commented. In any case, acquisition of a world-class steel mill has become neither more nor less than a matter of reality. Some industry sources here have it that the Mittal Steel's action has a close link to the single combat between Arcelor and ThyssenKrupp that has taken place since November last year vying to acquire Canadian Dofasco. Meanwhile an agreement has been entered into between Mittal Steel and ThyssenKrupp that the former would sell Dofasco shares to the latter, should Mittal Steel's acquisition of Arcelor have resulted successful. The top two steel mills of Mittal Steel and Arcelor are currently outdistancing others at large in their race to expand operations. Both of them have successively taken over world-class manufacturers; Arcelor reached in December 2005 an agreement to acquire a 49.29% share in Turkish formerly state-owned Erdemir; in the preceding month of the same year, Mittal came to purchase Ukrainian leading steel mill Kryvorizstal. Mittal Steel has thus become a 65-Mt/a steel producer, with Arcelor on its neck, producing 55 Mt/a soon, when Dofasco takeover is completed. World top placed steel mills appear to be zeroing in on a 100-Mt/a crude steel production. Japanese steel mills have a nexus some way or other with both of the above two top mills. As regards the recent M&A moves that have developed into world top mill's attempt to take over its good rival, steel mills in Japan are keeping their position to let the matter run its course for now. |
| last modified : Fri 03 Feb, 2006 [11:01] |
