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Minority stake for Mittal in new giant

Mittal is prepared to take a minority stake in rival Arcelor which wants to merge with Russian giant Severstal.

india Updated: May 30, 2006 13:59 IST

Mittal Steel, currently the world's number one steel maker, is prepared to take a minority stake in European rival Arcelor which wants to merge with Russian giant Severstal, Mittal's European chief Roeland Baan said in a newspaper interview Tuesday.

"It may be that at the end of the day we'll hold 40 percent of the combined Arcelor and Severstal group," Baan told the Financial Times Deutschland.

Last week, Mittal launched a concrete takeover offer for Arcelor on condition it secure more than 50 percent of the European steel maker.

But the announcement last Friday of Arcelor's plans to merge with Severstal has thrown a spanner in the works for Mittal.

If Severstal, which belongs to Alexei Mordashov, secures 32 per cent of Arcelor, it will be nearly impossible for Mittal to acquire the majority.

"With more than 20 percent, we'll be able to call a general assembly any time," Baan said. "That would give us a lot of power. We'd rather have that sort of influence than no influence at all."