Mittal Steel says outcome of Arcelor talks uncertain

BRUSSELS: Mittal Steel, the world’s largest steel producer by volume, said on Tuesday that talks with takeover target Arcelor were continuing but the likely result was uncertain.

“Mittal Steel confirms that discussions are taking place with Arcelor. The outcome of these discussions remains uncertain at this stage,” the group controlled by Lakshmi Mittal said.

Mittal and Arcelor chief executive Guy Dolle are both due to attend a steel industry conference in New York on Tuesday. But neither group would comment on whether the two men would take the opportunity to hold talks about how to resolve their takeover battle.

Arcelor said on Monday evening, that it cancelled a shareholder meeting scheduled for June 21 on a planned E6.5-bn share buyback plan which has been seen as defence against its rival.

Mr Mittal told the Wall Street Journal that Arcelor’s decision made him increasingly confident that he could convince Arcelor shareholders to back his offer to buy their company and pressure the management into dropping its resistance.

Meanwhile, influential US proxy advisory firm Institutional Shareholder Services on Tuesday recommended that shareholders of Arcelor vote against a transaction with Russian steel company Severstal. Arcelor is seeking shareholder approval for a deal that would see the company issue 295m new shares in exchange for a Severstal stake.

In its report, ISS raised concerns that shareholders had not been given enough time to consider the terms of the deal, and that all facts had not been fully disclosed.