Arcelor poised to snub Mittal again
Monday 12 June 2006
The board of the steel group Arcelor is today expected to announce the rejection of an improved offer from Mittal Steel.
Arcelor held a board meeting yesterday to formally discuss Mittal's €26bn (£17.8bn) bid, made last month. The bid was an improvement on the initial approach made in January.
Arcelor directors also considered their response to a revolt among the company's own shareholders over its alternative €13bn "white knight" deal to buy Russian group Severstal instead.
"I arrive with a very positive state of mind," board member Fernand Wagner told reporters on his way into the meeting at Arcelor's Luxembourg HQ.
Separately, it emerged yesterday that Alexei Mordashov, the Russian tycoon who owns Severstal, has personally written to Arcelor shareholders urging that they accept a tie-up between the two companies.
A meeting will be held on 28 June for Arcelor investors to vote on the Severstal transaction.
However, a group of rebels are furious that, under the rules adopted, the deal can only be stopped if more than 50 per cent of the entire issued share capital of the Luxembourg group votes against it.
The dissident shareholders, who account for 30 per cent of Arcelor, want to hold an extraordinary general meeting to change the voting process on the Severstal deal.
So far, the Arcelor board's tactic has been to concede the fact that the rebels are entitled to call an EGM, while insisting that the event take place after the vote on the transaction - rendering the EGM irrelevant.
The concerned shareholders have threatened legal action against individual Arcelor directors over the issue.
They have also said that, if the 28 June meeting goes ahead, they will vote at the event for a postponement.
The scheduled meeting on the Severstal deal also comes before the 5 July closing date for the Mittal offer - another cause of frustration for the rebels, and also the Mittal camp.
It is unclear whether Mittal will keep a minority stake in Arcelor if it fails to get more than 50 per cent. In a further twist of voting tactics, Mittal could deploy its minority stake at a future Arcelor EGM in conjunction with the company's rebel shareholders.
Rotterdam-based Mittal, majority owned by the billionaire Lakshmi Mittal, and Arcelor are the two largest steel companies in the world. A merger would create a powerhouse capable of producing more than 100 million tonnes of steel a year. It would have revenues of almost £40bn and a workforce of 320,000, but Arcelor has consistently resisted advances from Mittal and has said a deal with Severstal represents better value for shareholders.
A tie-up with Severstal would give the combined company sales of £31bn and production of 70 million tonnes of steel a year.
- 2 Dutch King Willem-Alexander declares the end of the welfare state
- 4 Giant Minion terrorises drivers in Ireland as 40ft inflatable blocks busy Dublin road
- 5 'Cool kids' can go on to become losers in later life, study finds
Sabrina Corgatelli: US hunting tourist posts picture of herself with dead giraffe after Cecil the lion outrage
'Gene drive': Scientists sound alarm over supercharged GM organisms which could spread in the wild and cause environmental disasters
Edward Heath 'child sex abuse' allegation: Investigation to be held into Wiltshire police handling of alleged claim in the 1990s
Labour leadership race: Jeremy Corbyn could be the next Prime Minister, says Ken Clarke
A-level results 2015: UK exam board OCR admits it 'estimates' hundreds of pupils' grades after papers 'go missing'
Is Britain really full up? Are migrants taking our jobs? Leading academic answers the most common anti-immigration claims
Calais Migrant Crisis: Deputy Mayor of Calais labels Cameron's use of 'swarm' as 'racist' and 'ignorant'
Chris Leslie: Jeremy Corbyn's anti-austerity agenda will harm the poor, says Labour shadow Chancellor
Landlords renting properties to illegal immigrants to face up to five years in prison
While we fixate on Calais, the Home Office is quietly deporting dozens of migrants on 'ghost flights'
Calais crisis: The seven claims made about the migrants - and the reality
iJobs Money & Business
£20000 - £25000 per annum + OTE £45K: SThree: SThree Group have been well esta...
£21000 per annum: Recruitment Genius: This is an exciting opportunity to join ...
Up to 70k DOE: Guru Careers: We are seeking an experienced Financial Director ...
£11000 - £50000 per annum: Recruitment Genius: This financial company offer ma...