Additional $3-billion burden on Mittal Steel over Arcelor Brazil
27 September 2006
Mumbai: Brazilian regulators have sought better terms for shareholders of the Arcelor''s Latin American subsidiary Arcelor Brazil, which is to be acquired by Mittal Steel as per merger regulations.
The offer for Arcelor Brazil, regulators argue, should reflect the 82 per cent premium paid for acquisition of Arcelor Europe. This would impose an additional $3 billion burden on Mittal Steel for takeover of the unit.
The Brazilian regulator, meanwhile, has upheld an earlier ruling requiring Mittal Steel to buy out minority shareholders on terms equal or close to those paid to stockholders of the Luxembourg-based parent company.
The Mittal-Arcelor merger has created a $38 billion steel giant, with 10 per cent of global production and 320,000 employees. L N Mittal, the group''s president, says the merger was doing better than expected.