Steelmaker Arcelor’s board has formally rejected last month’s takeover bid from Mittal, but has told Arcelor shareholders who do support it that they will have a chance to vote against an alternative agreed merger with Russia’s Severstal at a meeting on 30th June. However at least 50% of the company’s entire shareholder base would have to reject it.
Arcrelor’s chairman Guy Dollé said: “The board has the right to go ahead with the (Severstal) merger without asking the shareholders for their views.
All the shareholders, all of them, know that under the rules we have that power. So it would be a legal merger, unless the shareholders vote against it at the meeting.”
Arcelor’s board favours the deal with Severstal to create a company with combined annual sales worth 46 billion euros and production of 70 million tons. Arcelor and Mittal together would have sales of 55 billion and production of 115 million tons a year.
Arcelor’s board has not entirely shut the door to Lakshi Mittal and said it would be prepared to meet to discuss a possible improved offer. But Mittal says it has “no intention’‘ of doing that. The saga has now been dragging on since 27th January when Mittal announced its initial bid. Its current takeover offer to Arcelor shareholders is due to close on 5th July.
If it fails to get 50% of the shares it is not clear if Mittal would keep a minority stake in Arcelor.