Paris: Mittal Steel is increasingly confident it can convince Arcelor shareholders to back its offer to buy the European steel maker and pressure management into dropping its resistance, Mittal's chief executive said in an interview.
Lakshmi Mittal is quoted as telling The Wall Street Journal in its Tuesday edition that Arcelor had delayed a shareholder meeting on its $8.18 billion share buy-back plan – meant to fight Mittal's bid – because it knew it would not get their support.
Arcelor on Monday delayed the June 21 meeting after Carlo Tassara International, the largest single shareholder, raised its stake in Arcelor to 7.44 from 5 per cent.
The investor opposes the share buy-back plan because it would significantly reduce the value of Arcelor's stock.
A June 30 shareholder meeting is planned to give Arcelor shareholders the chance to oppose an alternative ‘white knight’ deal which would see Arcelor buy Russian steel group Severstal but give Severstal's main owner Alexei Mordashov a key stake in the enlarged group.
Arcelor wants to merge with its Russian peer to fend off Mittal. Mittal said the share buy-back would have allowed Mordashov to get a 38 per cent stake instead of 32 percent in Arcelor.
"The shareholders want to be given a choice," he told the newspaper. "They want to see both bids separate and cast their vote."
Arcelor is conducting talks with Mittal to end the takeover battle, and a source familiar with the matter has said that the steel maker hopes to have decided by June 30 whether it will reach agreement with Mittal.
The source said Arcelor would like to have wrapped up talks with Mittal by that date so the board could change its recommendation before the shareholder meeting if the talks were successful.
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