Arcelor announces merger plans


Steelmaker Arcelor has announced plans to buy Russian group Severstal, in a deal designed to block a hostile takeover bid made by the Mittal Steel company earlier this year.

The €13 billion transaction will create the world's biggest steelmaker and is expected to be completed by the end of July.

The deal values Arcelor at 44 euros per share, above the 35.62 euros per share of cash and stocks tabled by Mittal.

Luxembourg-based Arcelor said its offer represented "a premium of 100 per cent over Arcelor's closing price on January 26th 2006, the day before Mittal Steel announced its hostile offer, and 36.6 per cent over Arcelor's closing price ex-dividend on May 25th 2006".

The company said its shareholders would have about 68 per cent of the combined group.

Under the terms of the deal, Severstal's controlling shareholder, billionaire Alexey Mordashov, will contribute his entire stake in the Russian company and those in Italian steelmaker Lucchini in return for Arcelor shares.

Mr Mordashov will also pay €1.25 billion in cash for additional Arcelor shares at a price of €44, giving him a stake of around 32 per cent in the merged group.

Arcelor's chairman Joseph Kinsch and chief executive Guy Dolle will continue in their current positions.

Analysts say that the proposed deal is a ploy by Arcelor to avoid Mittal's hostile takeover bid.

Bookmark with:
Bookmark with: Digg Digg Bookmark with: Delicious Bookmark with: Reddit Reddit Bookmark with: StumbleUpon StumbleUpon Bookmark with: Google Google Bookmark with: Technorati Technorati Bookmark with: Netvouz Netvouz

Latest News:

Search News
News Front Page
Accountancy / Tax
Advertising / PR
Armed Forces
Aviation / Aerospace
Banking / Finance
Charities / Voluntary
Childcare / Youth
Construction / Property
Customer Services
Education / Training / Teaching
Emergency Services
Engineering / Electronics
Entertainment / TV / Theatre
Graduate Roles
HR / Recruitment
Health / Beauty
Hotel / Catering / Restaurants
IT / Internet
Insurance / Pensions
International / Overseas
Management / Business
Manufacturing / Industry
Media / New Media / Creative
Medical / Healthcare
Pharmaceutical Industry
Public Sector
Retail / Wholesale
Sales / Purchasing / Marketing
Science / Technology
Secretarial / PA / Admin
Skilled / Semi-skilled Manual
Transport / Logistics
Travel / Tourism / Leisure