Arcelor in bid to block Mittal takeover
26 May 2006, BRUSSELS — Arcelor has agreed to buy Russia's Severstal in a EUR 13 billion deal that could block Mittal Steel's hostile bid for the European group.
26 May 2006
BRUSSELS — Arcelor has agreed to buy Russia's Severstal in a EUR 13 billion deal that could block Mittal Steel's hostile bid for the European group.
Arcelor said on Friday that the Severstal deal would involve the issue of new Arcelor shares at a price of EUR 44 each, 20 percent above Mittal's current hostile offer, Reuters reported.
The chief executive of Arcelor, Guy Dolle, said the deal with the Russian company had been more than three years in the making. But he also said Mittal's takeover bid had been "a catalyst".
Severstal chief Alexei Mordashov will provide almost EUR 13 billion in cash and assets for Arcelor shares at EUR 44 for an overall stake in the new Arcelor of 32 percent. The deal would create the world's largest steel group.
Mittal Steel had sharply raised its offer for Arcelor by 34 percent on 19 May, offering EUR 25.8 billion to buy out its rival. It also promised to make changes to its corporate governance in a bid to win Arcelor's approval for the takeover.
But Arcelor's management have repeatedly rejected the planned deal since it was first mooted on 26 January.
[Copyright Expatica News 2006]
Subject: Belgian news