Mittal and Arcelor seek support
06 Feb 2006
The Luxembourg and French governments had earlier announced their reservations against Mittal Steel's take-over attempt of its nearest rival and global No. 2, Arcelor, in an unsolicted €18.6bn ($22.3bn; £12.7bn) bid. L N Mittal and the Arcelor CEO Guy Dolle are holding separate meetings with Belgian politicians today. While the Arcelor CEO has already met prime minister Guy Verhofstadt in Brussels last week, Mittal is meeting him today.
Dolle has also sought the support of the chief of the pro-labour Belgian Socialist Party, Elio Di Rupo, who is also president of the Wallonia region to fend off the take-over threat. The French-speaking Belgian region of Wallonia holds a 2.3-per cent stake in the Luxembourg-based Arcelor. Mittal is reported to have been having an uphill struggle to convince leading European politicians about the merits of his objective to strengthen the Europen steel industry to compete with China.
But Dolle has countered by saying that a deal would amount to a raid on its cash flow to fund the rebuilding of Mittal's plants. Arcelor employs 98,000 people world-wide to Mittal Steel's 175,000.
French finance minister Thierry Breton, who said he was remaining vigilant but was not "for or against" at present has already described Mittal's bid as "hostile", echoing the French government's fears about the possible impact on Arcelor's 28,000 French staff, despite the assurances from Mittal.
