Arcelor will ask its shareholders at a meeting scheduled on May 19 to back the repurchase of 150 million of its shares €50 each.

If Arcelor''s share holders approve of the move, it is expected to strengthen the management''s defense against Mittal Steel''s take-over bid announced on January 27, 2006.

L N Mittal, chairman and CEO, Mittal Steel Co, who has maintained that he wants friendly talks with Arcelor, reacted to Arcelor''s proposed buyback saying he remained resolute about completing the takeover.

Mittal''s planned purchase of Arcelor would be the biggest ever in the steel industry and create a producer three times as large as its nearest rival.

Arcelor has transferred Canadian steel maker Dofasco Inc., into a Netherlands-based trust to stop Mittal from selling it to Germany''s ThyssenKrupp AG. Arcelor had won a bidding war with ThyssenKrupp for Dofasco in January 23, this year barely three days before Mittal announced its bid for Arcelor. Mittal had also offerreed to sell the Canadian company to ThyssenKrupp, in the event of the take-over succeeding.

Mittal has said its lawyers were working on a way to unlock Dofasco from Arcelor if the management doesn''t agree to talks.

Arcelor has also initiated legal action in the US against Mittal Steel''s US operatoipns, Chicago-based Mittal Steel USA, of violating its patented Usibor technology, which uses boron, a soft nonmetallic element, that strengthens steel in cars to help them survive crashes.

Incidentally Arcelor and Mittal Steel today announced a decline in first-quarter profit. Luxembourg-based Arcelor''s net income dropped 20 per cent to €761 million, while Rotterdam- based Mittal''s profit fell 35 per cent to $743 million. share