Mittal confident of deal by June
Notwithstanding fear that Luxembourg’s government would seek to scupper his £13 billion bid for Arcelor by enacting new laws that would require his company to pay for the offer in cash, Lakshmi Mittal expressed the hope that he would clinch the deal in three months.
He said, “I am confident we will win,” on BBC Five Live’s Weekend Business programme. “At the end of the day, shareholders will make the right decision… and we should be completing the merger before the end of June.” He said, “Since it was announced, the transaction has created value of more than 7.5 billion euro for shareholders in both companies (through the rise in stock prices)”. He has criticised Arcelor’s prospects saying “They are not in the higher-growth market which is central and eastern Europe. They do not have the vertical integration, they do not have access to cheaper raw material… Plus, their strategy on stainless steel has failed.”
Mittal also voiced his concern over the reported move by the Luxembourg Chamber of Commerce to enact a law that would preclude any company with less public ownership from launching a share based offer for another group. It is known that Mittal Steel, a Dutch company, 88 per cent is owned by the Mittal family. It would thus fall below that threshold proposed by the Chamber of Commerce.
“I am really worried about the obstacles that Arcelor’s management are confronting me with,” he told the media.
His comments significantly was made as it emerged that Luxembourg’s Trade Minister Jeannot Krecke would visit India to discuss the bid with Commerce Minister Kamal Nath. Luxembourg knows that India is alarmed at the hostile reaction among European politicians to Mittal’s offer.