ArcelorMittal Buys Gas Distribution Company

Powerhouse steel company acquires 77 percent of the shares in Saar Ferngas.

ESSEN, Germany — ArcelorMittal today annouced it has signed an agreement with RAG Beteiligungs-AG, Essen, for the acquisition of the nearly 77 percent stake in Saar Ferngas AG, Saarbrücken, directly held by RAG.
The sale is subject to board approval and also to approval by the European antitrust authorities. The purchase price comes to approximately euro367 million (US$500 million). The transaction is to be completed by year-end 2007.
Arcelor Luxembourg S.A. will acquire the shares under the same conditions that had previously been agreed with the RWE Group. The German Federal Cartel Office denied the takeover of Saar Ferngas by RWE in March.
“The sale of the gas distribution unit is a systematic step in the realignment of RAG Beteiligungs-AG. This completes the refocusing of the Energy Business Area in particular to power generation from coal-fired power stations and renewable energies,” said Dr. Werner Müller, CEO of RAG Aktiengesellschaft and RAG Beteiligungs-AG.
“Saar Ferngas is an opportunity that fits well with our regional energy network. This acquisition offers excellent prospects and local synergies with the existing 20 percent stake of ArcelorMittal in Soteg, the Luxembourg gas distribution company in which Saar Ferngas holds another 10 percent,” said Michel Wurth, member of ArcelorMittal’s Group Management Board with responsibility for Flat Products Europe.
Saar Ferngas AG is the largest gas distribution company in Saarland and Rhineland-Palatinate. E.ON AG holds 20 percent of the shares in Saar Ferngas while various municipalities hold another 3.12 percent.
The group (approximately 150 employees) supplies natural gas to municipal power utilities, industrial plants and power stations. As a subsidiary of Saar Ferngas AG, Saar Ferngas Transport GmbH operates a natural gas pipeline network totaling 1,684 kilometers. In fiscal year 2006, Saar Ferngas generated sales of euro1.492 billion (US$2 billion) with EBIT of 50 million (US$68 million) in the areas of trade and shareholdings in other entities.
The supply area of Saar Ferngas primarily encompasses large areas of Rhineland-Palatinate and Saarland. With 23 shareholdings in other entities, Saar Ferngas also is active nationally and internationally.
ArcelorMittal is the world's No. 1 steel company, with 320,000 employees in more than 60 countries. The company brings together the world's No. 1 and No. 2 steel companies, Arcelor and Mittal Steel.
ArcelorMittal is the leader in major global markets, including automotive, construction, household appliances and packaging, with leading R&D and technology, as well as sizeable captive supplies of raw materials and outstanding distribution networks. An industrial presence in 27 European, Asian, African and American countries exposes the company to all the key steel markets, from emerging to mature, positions it will be looking to develop in the high-growth Chinese and Indian markets.
ArcelorMittal key pro forma financials for 2006 show combined revenues of $88.6 billion, with a crude steel production of 118 million metric tons, representing around 10 percent of world steel output.
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