Monday, February 06, 2006

Coq au Vin or Chicken Madras?

The furore over the Mittal bid for Arcelor seems to be settling down, with fewer aggressive statements from the French C.E.O.  appearing in press reports.

That is not to say that there has been any reduction in activity. Guy Dolle met with Akio Mimura of Nippon last week amidst speculation that Arcelor were seeking an ally in their expected defense of the takeover bid. Mr. Mimura denied that any request was made for assistance in heading of the approach, but that talks were simply about strengthening existing co-operation.

In a separate move Dolle is due to meet Belgium Prime minister Guy Verhofstadt today to discuss the issue. Officials in Belgium and Luxembourg who’s own steel industries were party to the formation of Arcelor have yet to state any firm opinions on the takeover bid.

It is in France where not only Gallic pride, but 26,000 jobs could be affected that feelings are running the highest.

It is not however for either Mr. Dolle or the outspoken French finance Minister Thierry Breton to decide the outcome. The correct procedure is surely for the board of directors to meet and decide whether or not to recommend acceptance of the bid and for the shareholders to decide.

Whether or not the French have anything to fear from a steel industry owned by Mittal is separate issue. The two companies without doubt come from very different backgrounds but ironically have both spoken publicly about the necessity for increased “globalisation” in the Steel Industry. Maybe the largest and second largest steel companies in the world shared the same vision, but envisaged different leaders?

No doubt I will be back to this subject soon.

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