19 May 2006
BRUSSELS — Mittal Steel sharply raised its offer for Arcelor by 34 percent on Thursday, offering EUR 25.8 billion to buy out its rival.
Mittal Steel also promised to make changes to its corporate governance in a bid to win Arcelor’s approval for the takeover.
Importantly, it also offered to reduce the Mittal family’s stake in the company to less than 50 percent.
Arcelor’s management have repeatedly rejected the planned deal since it was first mooted on 26 January.
The company has said the best thing for its shareholders is the company’s current management and plans. It had also raised concerns about Mittal’s corporate governance.
On Thursday, Mittal Steel officially offered EUR 21 billion for Arcelor in a deal that would create the world’s largest steel company.
Arcelor was holding a board meeting on Friday to assess the latest takeover offer and Mittal expects a reply next week.
The Wallonian government — which holds a 2.4 percent stake in Arcelor — reacted with caution to the new offer, stressing the region still had concerns over job losses.
“We are most concerned about the industrial project, not the financial criteria,” spokesman Christopher Barzal said, adding Belgium would make up its mind around the end of June.
Earlier this week, Prime Minister Guy Verhofstadt and the regional leaders of Flanders and Wallonia said they would need to ask more questions about Mittal’s bid, despite a commissioned report which said the initial offer was sound.
[Copyright Expatica News 2006]
Subject: Belgian news