Mittal denies Posco takeover plan
Mittal has described reports to acquire South Korean rival Posco to establish foothold in Asia as speculative.business Updated: Mar 25, 2007 13:47 IST
Arcelor Mittal has described as speculative the reports of the world's largest steel maker looking to acquire South Korean rival Posco for strengthening its foothold in Asia.
"These are all speculations," Arcelor Mittal Chief Executive Officer LN Mittal told reporters in Ghaziabad on Saturday when asked if he planned to acquire the world's fourth-biggest steel firm.
The Korea Economic Daily reported on March 16 that Arcelor-Mittal was mulling a hostile takeover of Pohang Steel Company (POSCO) and a message about Arcelor Mittal's interest was conveyed to the Korean major last month.
The paper had said Roland Junck, an adviser to Lakshmi Mittal, had in February asked POSCO specific questions about its merger and acquisition strategies in Asia.
However, Mittal's son and company CFO Aditya Mittal told CNBC television on Mar 23 "We are friendly with Posco and we are working with them to further alliances in technology." A merger or acquisition was not on the agenda, he had said.
Arcelor Mittal has been planning to expand in Asia and has made attempts in China, but with moderate success. It also plans to build a greenfield steel plant in India, but has failed to make much progress so far. Incidentally, Posco is also planning to build a mega steel project in India.
Expressing concern on the slow progress of its proposed steel plants in Jharkhand and Orissa, Mittal said the company was in talks with both the states as well as the Centre to expedite land acquisition and resolve other issues.
"Speed is a problem and we are in talks with the states and the Centre to sort out issues on land acquistion," Mittal said.
He, however, said when industrialisation of such magnitude happens, these issues were bound to occur.
Arcelor Mittal, the world's largest steel maker, has proposed to invest Rs 40,000 crores for building a 12 million integrated steel projct either in Jharkhand or Orissa.
He said talks with central and state governments were progressing in the right direction.
Allaying fears of unusual increase in steel prices, the India-born billionaire admitted that steel prices have shot up due to increase in input costs but argued there was nothing unususal about it.