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Europe goes all out to stop Mittal

How hostile Luxembourg and France are to Mittal Steel's bid for Arcelor is becoming clearer, writes Vijay Dutt.

india Updated: Feb 13, 2006 14:48 IST
Vijay Dutt

Just how hostile the governments of Luxembourg and France are to Mittal Steel's bid for Arcelor is becoming clearer by the day.

In the latest twist to its opposition, the Grand Duchy, the Government of Luxembourg, is to rush through a bill on takeovers which could protect Arcelor from the $23-billion bid by Lakshmi N Mittal's company.

Luc Frieden, finance minister, Luxembourg, said the bill adopted an amended version of an EU takeover directive that would allow a besieged company's board to repel a hostile takeover bid without seeking prior consent from a general assembly.

The new law raises the possibility of Areclor creating a poison pill to deter Mittal Steel by issuing new shares or making a bid of its own for another company, said a media analyst.

Freiden was at pains to stress that the bill was neither anti-Mittal nor pro-Arcelor. The Luxembourg PM was, however, candid enough to say he was totally opposed to the Mittal bid.

France, for its part, is said to be working on a proposal for Arcelor to buy Eramet, the French mining and metals group.

There is room for detectives too.

An economic columnist has written in the Times that last week Arcelor "ordered the hiring of some private detectives to dig dirt on Mittal -- just in case Dolle (Guy Dolle, chief executive, Arcelor) runs out of groggy xenophobia to sling at the Asian billionaire."

She said in a measure of quite how dirty this fight could get, even the selection of spooks has prompted mud-slinging. It was said that the Mittals were trying to hire an agency, connected with the one Dolle was choosing, to muckrake on Arcelor. The agency's office in London denied this.

First Published: Feb 13, 2006 03:02 IST