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Arcelor vows to resist Mittal's hostile takeover bid (Roundup)

Jan 30, 2006, 15:00 GMT

epa photos available = Paris (dpa) - Arcelor head Guy Dolle vowed Monday to resist the hostile takeover bid from Mittal Steel, saying that the future of his company would be 'brighter' if it were left alone. 'The two companies are diametrically opposed,' Dolle told journalists in Paris, singling out the two companies' management styles, business models and stock market evolution. He also said that the steel produced by Mittal was merely 'Eau de Cologne' while Arcelor's products were 'perfume'. 'Shareholders would be undermined (by the takeover). It would also be threatening for our employees,' Dolle said, and concluded: 'The future would be brighter for our enterprise without Mittal Steel.' Arcelor's counter-offensive against the bid will take 'a very, very long time,' Dolle said, invoking a period of from four to six months. Earlier Monday, he told a French radio station that Arcelor would resist Mittal's 18.6 billion euro (22.7-billion-dollar) takeover bid. 'We have been preparing for this attack since last spring. We are ready. We have the means with which to resist,' Dolle told Europe 1 radio. 'We have known for a year that (Mittal) is interested in us. The battle has been joined, and we will win it.' His statements came as Mittal Steel head Lakshmi Mittal travelled to Paris to defend his offer for the world's second-largest steelmaker. Early Monday, Mittal sat down with French Finance Minister Thierry Breton to lay out his strategy and defend his bid against charges that, among other claims, it would lead to massive layoffs in France, where Arcelor employs some 30,000 people. However, whatever Mittal told Breton, it did not convince the finance minister to look upon the offer with favour. Breton told journalists following the meeting that 'there was today no industrial project' in Mittal's hostile takeover attempt. In fact, Breton said, there was 'no information other than the fact that the cultures of the two groups could function and live together.' 'Therefore, since we have no information at this stage, we can only repeat our strongest reservations,' Breton said. 'Mr. Mittal understood the French government's worries' about the bid. Breton said the French government and other European governments were worried about the takeover attempt because 'Arcelor, a European group, carries out a very large part of its activities in Europe, notably in France.' For his part, Mittal said that he did not buy factories to shut them. In case of a takeover, no jobs would be lost, he said. 'This is not a war,' he said. 'We create values for shareholders.' He also told journalists in Paris that he expected to successfully conclude the takeover in the second quarter of this year and that he foresaw synergy gains of 1 billion dollars from the merged group, 60 per cent of which would be realized the first year. Mittal said his family would control 51 per cent of the shares and 64 per cent of the voting rights of the newly formed company, which he said would be the result of 'a merger of equals.' Although Mittal said he would not modify his original offer of 28.81 euros per share, investors in Paris were wagering that he would. Arcelor's share price was up nearly 4 per cent, at 29.66 euros, in afternoon trading on the Bourse. On the year, Arcelor stock has now gained more than 41 per cent in value, largely because of Mittal's bid. On Sunday, the board of the Luxembourg-based steelmaker formally rejected the hostile takeover bid, which Mittal Steel launched last week. Arcelor announced the 'unanimous' rejection on its website late Sunday after an extraordinary board meeting in Luxembourg. Mittal is the world's biggest steelmaker and Arcelor the second- biggest. A takeover would create the first company with production above 100 million tons a year and around 10 per cent of global steel production. Mittal, which announced its bid Friday, has its headquarters in Rotterdam but is managed from London. Arcelor was created in 2002 out of Luxembourg's Arbed, Spain's Aceralia and the French company Usinor. © 2006 dpa - Deutsche Presse-Agentur

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somenath basuFeb 1st, 2006 - 14:55:53

Dear Sir,
The Mittals are Kolkata backstreet marwari boys who are a rags to riches story ,they cant match the outlook of the French. Saying goes that French nobleman kept servants whose job was to kill frogs/toads to keep them away from croaking while they slept a peacefull nights sleep such was the aristocracy and mindset of the French.
Anyhow i would like to share my experience of another Mittal family led steel group who are blood relations of Lakshmi Mittal.I was lured by employment of Global Steel Holdings Limited which has its adminstrative offices in Dubai and London at Ramsay Isle of Man, and sent to Ajaukota Steel Company,
Nigeria,from India,I had to come back as it had horrible work conditions.I was without pay and living allowances back to India.The company has taken over steel plants in Bulgaria,Phillipines where the working conditions are similar employees have wages due and facilities promised were not given.Indian steelplants are loosing their valuable human resources and skilled persons are being lured away and made to work with false promises.Hostile take over bids such as these should be resisted all out.

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