Financial Daily from THE HINDU group of publications
Tuesday, Feb 21, 2006
Financial Daily from THE HINDU group of publications Tuesday, Feb 21, 2006 |
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Foreign Relations Corporate - Mergers & Acquisitions Industry & Economy - Steel PM takes up Mittal's Arcelor bid with Chirac French President says no future plan has been submitted Our Bureau
New Delhi , Feb. 20 INDIA today took up at the highest level the controversial bid by steel tycoon Mr L.N. Mittal for acquiring the second largest global steel company Arcelor, with the Prime Minister, Dr Manmohan Singh, raising the issue with the visiting French President, Mr Jacques Chirac. Confirming this at a joint press conference here, Dr Singh said, "Yes, this matter did come up during our discussions," and expressed the hope that a "fair decision" would be taken considering the "interests of all stake-holders." Mr Chirac, on his part, maintained that France was opposing the move because of concerns in Europe over Mr Mittal's hostile bid though it was absolutely legitimate but was "contrary to practice." Mr Chirac, however, said that he was "not pre-judging anything." Pointing out that Mr Chirac explained his country's position in detail, Dr Singh said, "it is my hope that a fair decision, taking into account the interests of all the stake-holders, will be taken in this matter." Significantly, Mr Mittal had met Dr Singh on Monday morning ahead of the meeting of the two leaders. Fielding questions during the press conference, Mr Chirac said that the bid was "purely financial in nature" and there had been no presentation of any kind of industrial development plan. "We do not know anything about the contents of what is intended. Therefore, we will wait and see. We are not pre-judging anything,'' he said. Emphasising that there was nothing against a non-European bidding on a European company, the French President said that "all I am saying is that we are waiting to see what the bid is and what the offer actually involves before we pass judgement on it." "We do not act nor should we have intention of acting against a company or procedure. The situation as it stands right now is simply that a hostile bid has been made contrary to the practice with no prior explanation, no reasons given," the French President said. "We were given no reasons for this bid, we have no notion of intentions, of what lies ahead for the company in question. There is no plan that has been presented,'' he said. He added that no prior consultations had been made in this regard "which is in fact contrary to usual practice in such matters." The Netherland-based Mittal Steel has made a $22.3-billion bid for Luxembourg-based Arcelor to create a mega steel company with an output three times bigger than its three nearest rivals combined. Mittal Steel and Arcelor are the world's largest and second largest steel manufacturers, respectively. Mittal's bid has led to objections from the governments of France, Luxembourg and Spain and labour unions that are worried about job losses even though the bidder has assured that no worker would lose the job. At the official level, Mr Mittal's case has so far been taken up by the Commerce and Industry Minister, Mr Kamal Nath, who had written to the European Union's Trade Commissioner, Mr Peter Mandelson, pointing to the unfairness of the stand of Arcelor and some EU governments.
Related Stories: More Stories on : Foreign Relations | Mergers & Acquisitions | Steel
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