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Mittal to rule steel world in six weeks
Mittal Steel Co, which quadrupled its profit in 2004, said on Thursday it expects to complete its transformation into the world's biggest steel producer in six weeks.
Mittal Steel Co, which quadrupled its profit in 2004, said on Thursday it expects to complete its transformation into the world's biggest steel producer in six weeks.
That's when it estimates it will close on its $4.5 billion acquisition of International Steel Group Inc for $4.5 billion and merge the US steel maker with the other assets of Indian-born steel magnate Lakshmi Mittal.
The purchase of Richfield, Ohio-based ISG is the final step in the bid by Mittal to surpass Europe's Arcelor as the biggest steel producer. Mittal was born last December when Dutch company Ispat International NV completed its acquisition of LNM Holdings.
Mittal, an $18.5 billion behemoth that dwarfs the market capitalizations of US steelmakers, such as Nucor Corp and US Steel Corp, began trading in December on the New York Stock Exchange and Euronext's Amsterdam bourse.
On Thursday, the company announced it quadrupled its net income in 2004 on the back of a China-driven surge in steel prices and forecast a stable market in 2005. Full-year net income rose to $4.7 billion from $1.2 billion, and revenue jumped 132 per cent to $22.2 billion.
Late on Wednesday, ISG reported its fourth-quarter profit soared, along with high world steel prices. Net income was $606 million, or $5.87 per share, compared with a loss of $48.7 million, or 57 cents per share, in the same quarter of 2003.
The company said its results included an unusual income tax benefit of about $390 million, or $3.78 per share. Excluding this tax benefit, net income was $216.1 million or $2.10 per share. Analysts on average were expecting $2.08 per share, according to Reuters Estimates.
During an analyst conference call on Thursday to discuss Mittal's results, president and chief financial officer Aditya Mittal, who is Lakshmi's son, outlined the remaining procedures in the ISG acquisition.
On December 20, ISG and Mittal cleared an antitrust hurdle by getting an early termination of the Hart-Scott-Rodino Act waiting period, which speeded up the planned merger.
The younger Mittal said the Securities and Exchange Commission had now responded to Mittal's F4 filing with certain comments regarding the deal. Mittal was addressing those comments.
"We believe our filing is in good shape and think in about two weeks it should be approved," he said. "Then we can send out our offering to (ISG) shareholders.
"We expect within the next six weeks to have the shareholder vote and then close (the acquisition)."
Shares in Mittal Steel were up 30 cents or 0.8 per cent at $37.95 on the New York Stock Exchange in Thursday afternoon trading. ISG stock was up 14 cents, or 0.35 per cent, at $40.65.
