This week has seen a flurry of activity in the bidding war for Dofasco. Last weekend saw an increased offer from Thyssen Krupp of $68 a share which many thought would bring the matter to an end.
Surprisingly Arcelor responded with a bid of $71 which takes the offer price beyond what most analysts and industry insiders expected.
There is no doubt that Dofasco is quite a “prize”, it is Canada’s largest steelmaker producing some 5 million tons a year. The company is profitable and well established in the “key” North American automotive sector. For any European steelmaker with ambitions in Canada and the USA there is unlikely to be any opportunity to match the acquisition of Dofasco, but at what price?
Arcelor is the second largest steelmaker in the world after Mittal, and notably lost out to it’s larger rival in a bid for Ukraine's Kryvorizhstal steel company in October of last year. If the bid for Dofasco is an attempt to rescue “bruised” pride, it may prove an expensive one.
Thyssen Krupp are considering their position.