Main focus of Monday, June 26, 2006

Arcelor's about-face

The European steel group's bosses backed a 25,6-billion-euro buyout offer from sector leader Mittal Steel on Sunday, June 25, five months after rejecting its initial bid. The announcement brought an abrupt end to the hopes of Russia's Severstal, with whom Arcelor was still in talks.

Tageblatt - Luxembourg

"European steel giant Arcelor, which is merging with its rival Mittal Steel, got caught in its own trap by raising the stakes via its marriage proposal to Russia's Severstal - a move intended to counter Mittal's hostile bid," writes the Luxembourg daily. "Arcelor's directors have been 'playing a double game' since mid-June. In an effort to patch things up with its shareholders, Arcelor strove to secure a more presentable marriage contract with Severstal, while simultaneously initiating secret high-level talks with rival Mittal Steel on June 13. ... Mittal Steel's sweetened buyout offer of more than 40 euros represents a near doubling of Arcelor's share price on the eve of the announcement of the hostile bid on January 27. A resistance which, when all is said and done, paid off for shareholders." (26/06/2006)

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Le Soir - Belgium

The daily's editor-in-chief, Beatrice Delvaux, says Arcelor's bosses exposed "themselves to ridicule on the public stage ... So what's so shocking here? The passing of Arcelor-the-beautiful under the wings of Mittal-the-voracious ? No, because the bidding war had to end some time and an Indian denouement to this bad thriller was, ultimately, more reasonable. What is shocking is the smoothing over of a string of errors. This impunity that lends the appearance of a marriage between friends in which nothing was prohibited. The Arcelor bosses' Russia campaign should be their Waterloo. If they want the final act of this steel-industry vaudeville to have any credibility, it is imperative for the Kinsch-Dolle duo [Arcelor's directors] to step down. Arcelor's future can no longer be associated with their brand. This is the risk one takes when playing Russian roulette." (26/06/2006)

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Le Figaro - France

The daily's deputy editor, Nicolas Barre, draws the "lessons from a battle". "The symbolic value of this merger is obvious to Europeans who based their original union project on steel in the aftermath of the second world war. Though European by statute, the Mittal group has developed on the emerging markets in less than two decades. The fact that today it is able to offer itself such a jewel of the Old Europe provides the first, spectacular, lesson of this five-month stock market battle: economic mutations are gaining speed, nothing can be taken for granted, the centre of the planet's industrial gravity is shifting. Should we be alarmed at this ? The Arcelor-Mittal merger proposal could well prove the contrary. The future steel colossus will control 10 % of a rapidly growing world market." (26/06/2006)

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All available articles from » Nicolas Barré

Hufvudstadsbladet - Finland

Commenting on Arcelor's takeover by Indian company Lakshmi Mittal, Björn Sundell draws attention to the fact that capital from the Third World is flowing back into Europe after decades of Europe pouring capital into developing countries. "The poverty of the Third World is appalling and tends to blind people to the fact that there are also many rich people in countries like India, Nigeria or Brazil. It's not in the US or Europe that the number of millionaires is growing fastest, but in Latin America, the Middle East and Africa. This is owing to the rising price of raw materials, which forms the basis of new wealth. And now the millionaires are building new empires out of the developing countries." (26/06/2006)

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All available articles from » Björn Sundell

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