Lakshmi Mittal is a happy man. Apparently, Mittal director, Wilbur Ross, received a phone call from the steel company’s eponymous boss last night, in which the jubilant Lakshmi said: “We got it, we got it’” about twenty times.
And yet, eyebrows would surely have been raised, if Arcelor had not finally agreed to the deal on offer. The price Mittal is paying is 40% up on the Arcelor share price before the initial overtures were made. The new board will consist of 18 members, six of whom will be from Mittal and six from Arcelor. The Mittal family will control just 40% of the new business, and Arcelor shareholders will have 50.6% of the company, which will be called Arcelor Mittal . Of the seven strong management team, four will come from Arcelor, and its chairman, Joseph Kinsch will be non executive chairman of the new company, while it’s been reported that Arcelor chief executive Guy Dollé will be the chief executive of the new company. Okay, Lakshmi Mittal will be life-time president, but it might be worth while pointing out that Mittal is buying Arcelor, not the other way round.
Russian company, Severstal, is not too happy. It had already agreed terms with Arcelor, and is likely to press for $140mn in termination fees.
When Mittal first made its offer for Arcelor, Thierry Breton, the Finance Minister, said of the Indian businessman who is currently the richest man living in the UK, that he was ignorant of “business grammar.”
Yet Arcelor, it appeared, was prepared to go to any extreme to stop Mittal. But finally, shareholders, who felt the company was not acting in their interests, finally forced the company to reject the Severstal deal, just as the Mittal offer was looking really very good indeed.
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