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Mumbai:
Arcelor Mittal, the world''s largest steelmaker, is looking to acquire AK Steel
the Financial Times reported on its web site. align="left">AK
Steel produces flat-rolled carbon, stainless and electrical steel products, as
well as carbon and stainless tubular steel products, for automotive, appliance,
construction and manufacturing markets. align="left">Without
citing any source or confirming through official sources, the FT Alphaville
web site report said that a deal could value AK at around $40 per share, or just
under $4.5 billion. Arcelor Mittal declined to comment on the report while
industry analysts raised doubts whther Arcelor Mittal would go ahead with such
a deal in the light of possible anti-trust issues. Investment banking
sources in Europe also said an acquisition could raise competition concerns in
the flat carbon market for the automotive industry in North America. Arcelor
Mittal had to divest its US steel plant at Sparrows Point to address US competition
concerns after it decided to keep Arcelor''s Canadian unit Dofasco within the fold
of the merged Arcelor Mittal group. AK Steel reported over $6 billion
in sales in 2006. In its first-quarter earnings release, AK Steel said net earnings
were $62.7 million, or 56 cents per share, compared with $6.2 million, or 6 cents
per share, a year earlier, the FT web site report said. Arcelor
Mittal and Nippon Steel Corp, meanwhile, have agreed to double automotive sheet
capacity at their US joint venture at an estimated cost of $254 million (30 billion
yen), the Nikkei business daily reported. L.N. Mittal and Akio Mimura,
the heads of the world''s No. 1 and No. 2 steelmakers, also agreed to expand their
alliance in areas other than their US venture at a meeting in New Delhi, the paper
said. The two companies are seen adding a new 500,000 tonnes-a-year line
to the Indiana plant, doubling its output capacity, to meet strong demand from
Japanese automakers such as Toyota Motor Corp.and Honda Motor Co., it said.
Nippon Steel, the biggest beneficiary of strong worldwide sales of Japanese
cars, earlier this month raised its full-year forecast for the third time in six
months on booming demand from carmakers and said it would post a record profit
for a third straight year.
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