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Arcelor bid: Mittal Steel begins campaign to counter opposition

Our Bureau

Kolkata , Jan. 30

MITTAL Steel on Monday began a sustained campaign to counter the opposition to its $23-billion bid after the 18-member Arcelor board's rejection of the offer on Sunday.

Sources in Mittal Steel told Business Line that without raising the offer, the company would engage itself in a "friendly" dialogue with the Governments in Europe, the shareholders, management and employees of Arcelor in the next few weeks.

The Government of Luxembourg is understood to have sought employment and investment guarantees in the offer. The top management of Mittal Steel is scheduled to meet the French Finance Minister today and is also expected to make a detailed presentation to the European Competition Commissioner later on Wednesday.

It has initiated steps on Monday to fulfil stock market regulatory obligations across the Atlantic to carry through the offer to its logical conclusion, the sources said.

Arcelor's board of directors described the offer as "hostile" and apprehended job cuts, and mismatch in culture and strategies.

It also urged Arcelor's shareholders to spurn the Mittal Steel offer. The Arcelor board, headed by Mr Joseph Kinch, unanimously expressed its anguish over the "severe consequences" the offer would have on the company and its stakeholders, including customers. Europe accounts for 75 per cent of Arcelor's revenues.

According to share capital distribution (as on September 30, 2005), Luxemburg State holds around 5.6 per cent of the total Arcelor shares (around 64 crore), while Corporacion JMAC BV, Aristrain has 3.5 per cent, Walloon region (SOGEPA) 2.4 per cent, employees 2 per cent and others (including own shares) 86.5 per cent.

Related Stories:
Mittal Steel launches bid for Arcelor — $ 22.7-b offer aimed at creating `European consolidation'

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