Mittal Steel Co announced here yesterday that it will discuss its hostile bid for rival steelmaker Arcelor SA at a May 9 general shareholders meeting but that it will not be put to a vote.
"These items of the agenda will be voted upon in an extraordinary general meeting of shareholders the date of which is expected to be announced following the opening of the tender period for the mixed cash and exchange offer for the outstanding share capital and equity securities of Arcelor," Mittal said in a press release.
The shareholders circular on the Arcelor offer will not be made available at the May 9 meeting as announced earlier because "the offer document has not been formally approved yet by the applicable regulators," the company said.
Mittal's 18.6-billion euro (US$22.9 billion) offer for Arcelor, which was announced at the end of January, has sparked concern in Luxembourg, Madrid and Paris although the Belgian government has not openly said whether it is in favor or against the deal.
Because Arcelor is traded in Luxembourg, Brussels, Paris and Madrid, Mittal's bid to acquire the group requires the approval of regulatory authorities in the four countries.
On Thursday, Lakshmi Mittal hit back at what he called "disinformation" about his company's hostile bid for smaller rival Arcelor and said talks with European politicians had made "good progress."
Speaking during a visit to a Mittal Steel plant in Gandrange, northeastern France, Lakshmi Mittal put aside his usual reserve to issue an uncharacteristically blunt response to arguments advanced by Luxembourg-based Arcelor, as it seeks to resist Mittal's offer.
Many of the claims have been "disingenuous and misleading," Mittal said. "It's natural that change should prompt concerns ... But it's wrong when people who should know better play upon such fears through use of disinformation."
perfume and cologne
Guy Dolle, Arcelor's French chief executive, has repeatedly compared his own company's steel to perfume, while dismissing Mittal's as lower-margin "eau de cologne."
Arcelor executives have also tried to stoke concern that Mittal's rapid expansion has stored up massive future upgrade costs at production plants that fall short of developed-world standards.
Mittal Steel's investment in emerging markets is a strength, not a weakness, the company's boss said, since these markets account for the lion's share of the global industry's growth -- currently between 3 percent and 4 percent.
"It is inconceivable to think that in 10 years' time any company that expects to play a leading role in the sector will not have a significant presence in these markets," said Mittal. Those who had the "vision and foresight to act on this at an early stage" will benefit most.
Per-capita steel consumption in India is still only about 8 percent of its level in Western Europe, where Arcelor does about 80 percent of its business but where growth is "very limited," he said, adding that the strategic significance of emerging markets "appears not yet to be fully understood."
Claims that "high margins only come from high-quality business" were also wrong, Mittal said. "Arcelor is actually a good example of this. Its highest margins come from its Brazilian business -- the so-called `cologne' of the company."
He also stressed the complementary fit between the two companies. Mittal Steel is the biggest supplier of high-grade steel to the US auto industry; Arcelor occupies the same position in Europe.