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Home > Business > Business Headline > Report

Mittal makes $22 bn offer for Arcelor

January 27, 2006 19:35 IST

Steel tycoon Lakshmi Mittal launched a Euro18.6 billion (over$22 billion) takeover bid for Arcelor of France on Friday, a move that would lead to the merger of the world's two biggest steel companies.

According to a release on the website of Mittal Steel, the offer values each Arcelor share at Euro 28.21, which represents a 27 per cent premium over the closing price and all-time high on Euronext Paris of Arcelor shares on 26 January 2006.

The offer values Arcelor at an equity value ofEuro18.6 billion (over$22 billion) on a fully diluted basis, the release said.

Under the terms of the offer, Arcelor shareholders will receive four Mittal Steel shares and Euro 35.25 cash for every five Arcelor shares.

Lakshmi N. Mittal, chairman and CEO of Mittal Steel, said, "The last ten years have seen a major shift towards consolidation of the steel industry, helping to create sustainable value for all stakeholders. Both Mittal Steel and Arcelor have been at the forefront of this consolidation and share a similar vision for the future of our industry. This combination accelerates this process and leaves us uniquely positioned to benefit from the opportunities created.

"We believe the offer provides a very attractive premium and has been structured so that Arcelor shareholders have the opportunity to participate in the exciting growth potential of the combined company, whilst also receiving a generous cash element. We would encourage them to consider the merits of our compelling offer and play a part in the future of the world's only global steel company."

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