World’s Biggest Steelmaker Bids for Arcelor

Mittal Steel has bid $22.8 billion for its biggest rival, Arcelor, to consolidate the still-fragmented steel industry. It also struck a deal to sell steelmaker Dofasco Inc. in Canada to ThyssenKrupp if Arcelor succeeds with its pending bid for Dofasco.
According to the 88.6 percent family owned Rotterdam-based Mittal, the unsolicited cash and shares offer for Arcelor would create a $40 billion organization producing more than 100 million tons of steel a year, more than three times of its closet rival Nippon Steel.
Analysts report that the offer had the potential to reshape a fragmented industry, which suffered from overcapacity during economic downturns. Global steel shares rallied on the hope of more deals.
Arcelor shareholders, under the offer will get four Mittal shares and 35.25 euros for every five Arcelor shares, according to a statement released by Mittal.
Reuters was told by a Mittal spokesperson that the Mittal family, headed by Indian-born Lakshmi Mittal, the world’s third richest man, would have a 51 percent stake in the combined businesses.