Mittal wins Arcelor
Brown knight to rook 4 — Mittal just won Arcelor:
The world’s two largest steel companies, Arcelor and Mittal Steel, have agreed on a merger deal valued at… about $32.5 billion, ending five months of bitter resistance… The merger will combine Arcelor… with a fast-growing conglomerate founded by an Indian, Lakshmi Mittal, who built a fortune turning around sick steel plants in rapidly expanding markets from Trinidad to Kazakhstan…
The agreed offer is nearly 40 percent higher than his initial offer in January, which was 27 percent higher than Arcelor’s stock price at the time. Mr. Mittal also was expected to concede some management control and family voting rights…
“… [T]he world system, which has been maintained by the United States and Europe, has suddenly got to adjust to the rise of China and India, and it ain’t going to be easy…” [Mittal is] now the world’s fifth-richest person, according to Forbes… [Link]
… Arcelor’s board and its management… once dismissed the idea of a merger with a “company of Indians”… The new company would be named Arcelor-Mittal, and would be headquartered in Luxembourg. Arcelor shareholders would have 50.6 percent of the new company. [Link]
Mittal’s patient hostile takeover reminds me of Oracle’s long, and ultimately successful, pursuit of PeopleSoft. Look for a mass firing of the Arcelor execs who put their jobs ahead of their shareholders:
Arcelor’s shareholders, including institutional investors and a number of hedge funds, were angry enough about the way the deal with Severstal was being forced through that they had started to talk about trying to oust Arcelor’s management and suing its board members. [Link]
Analysts see the deal as a bellwether because the UK-based Mittal Steel invests in developing countries:
The fight for Arcelor was closely watched around the world, as it evolved into a clash between two major forces shaping the world economy: the ascendancy of India and China as sources of new business models and ambitious new companies, and a rising tide of protectionism in the West, fueled by anxiety that new competition will erode a way of life…
… analysts expect a surge of acquisition attempts by multinationals rooted in the developing world. “The emerging markets are running the big surpluses, they are accumulating capital and they will be spending abroad…” [Link]
How ya like that ‘monkey money‘ now?
on Monday, June 26th, 2006, 1:39 am in Business › 
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I don’t see what the big deal is. Mittal does 0% of his business in India and in any case seems to identify more with being British than being Indian. At one point he almost went so far as to disavow India.
He’s not the one making race an issue, Arcelor management was.
I wouldn’t let Mittal off the hook so easily. Didn’t Manmohan Singh get involved in this whole affair? Mittal is Indian when it suits him.
Off what hook? Nobody’s saying Mittal isn’t of Indian origin. The $55M Versailles wedding is proof ;)
Mittal didn’t ask the Indian PM to get involved. What you’re implying is pretty disturbing and deserves more than a potshot.
Yup. And isn’t he an “Indian citizen” too ?
Yup, he’s a British Asian with Indian citizenship.
I said:
Here’s some evidence:
It was blogged about in a number of places at the time. It undercut Mittal’s position that his company was European and therefore a better suitor for Arcelor.
Why is this “pretty disturbing” ?
Context if I remeber correctly was a little different. I think Manmohan Singh brought this up because at the time it was getting pretty anti indian, and some French Politicians were talking junk. This was more of a “if you guys want to keep doing business here, you better not be saying a company run by a bunch of indians isnt allowed to own a business in france”.
At least thats how I remeber what happened.
Though being India, I am sure influence was used by Mittal to make Manmohan Singh aware that he wanted the support of the Indian Govt.
What’s disturbing is your crack that Mittal is ‘Indian when it suits him.’ It reads like an Uncle Tom insult.
Not at all. The actions of a third party have little to do with Mittal. Can you source your assertion that he asked the Indian PM to get involved?
Not at all. It’s a political statement. If you want to emphasize the European nature of your company then perhaps you ought to tell the Indian government not to defend to get involved.
I never asserted that (look back) precisely because I lack the evidence to demonstrate it. However, news reports indicated that the PM was planning to ask the French President about the merger. If Mittal didn’t want this to happen, he could have asked them not to or disavowed their interference afterwards. The most likely inference to be drawn from his lack of action, given the political sensitivities involved here, is that Mittal wanted the Indian government to get involved.
Nor is it the case that there were no contacts between Mittal and Manmohan Singh, quite the opposite.
Let’s flip it around - why might the PM get involved in the merger of two European companies? He has never done so before. The most likely explanation is that he is doing so on behalf of one of the companies.
Again, I never claimed this, but since you’ve said it, I think that it’s our most likely explanation. Sticking to the facts, however, the point is that Mittal emphasizes the European nature of his company when he wants, but then benefits from the interference of the Indian PM. These two approaches are inconsistent.
Isn’t Mittal helping the G of I buy oil wherever they can get it? As far as I remember, he’s been involved in many bids (where India lost finally to China). So perhaps he has good enough relations to call in a favor.
Mittal went in with the G of I’s oil company on the Kazakhstan bid
Wow - So the ragging battle of words and debates continues here :)
The PM and Indian Trade Minister did voice their concerns on this to the French - including Chirac. But that was after the French Finance Minister, Chirac, and a bunch of others all came out and made batant xenophobic statement againt Mittal, his company, and essentially a ‘bunch of Indians’.
The Indian govt. has a right to inquire and clarify. Wouldn’t u think so? I mean, if there was an official French discriminatory policy against Indian companies, then the Indians ought to know - only so that they know thier place in Eurpoean society !
Your point is a non sequitur. If you oppose the war in Iraq, and so does bin Laden, is ‘the most likely explanation’ that you asked for his help? If you failed to ask him not to get involved, is ‘the most likely inference’ that you wanted him to get involved?
Show me the evidence.
Sure, my contact in the PMs office told me that Mittal got on his knees, cried, and gave Manmohan Singh $100,000 in cash in return. Of course I don’t have that level of proof, but you’re being inconsistent concerning the level of proof that you demand.
But your counter-example is way off base. These are two actors with many contacts between them (that I can document). Mittal Steel is being accused of being an Indian company. The press indicates that Manmohan Singh is going to raise the issue of the merger with the French President, thus implicitly confirming the accusations. Mittal Steel does nothing to prevent or disavow this action, either before or after, even though it plays into their critics hands. That, to me, is being Indian when it suits him. Emphasizing his European connections in one context, while not disavowing help from India when it arrives.
My interpretation is pretty much common sense. Mittal’s lack of response here speaks volumes.
Third parties’ actions are not Mittal’s responsibility. And based on this weird burden shift, you’re now asserting something quite serious without linking to a single news story that says Mittal asked for Indian government help. Not even one.
Using your methodology, I assert that you own an invisible pink unicorn.
http://www.hindustantimes.com/news/181_1730995,001302270000.htm
Indian managers forged Mittal’s steel empire:
Mittal’s A-team is full of Indians. Nine of his 17 CEOs and nine of his 16 corporate directors are Indians. They include COO Malay Mukherjee, MD (controlling) Bhikham Agarwal and MD (business development, treasury) Sudhir Maheshwari. The Mittal board also includes finance heavyweights like ICICI chairman Narayanan Vaghul, State Bank of Mauritius chairman Muni T. Krishna Reddy.
I’ve given it a few days, I understand what you’re saying, and I still think you’re completely off base.
Your point, as I understand it, goes like this. If the KKK say the war in Iraq is bad, that doesn’t mean that people who oppose the war in Iraq are tied to the KKK.
However, there is a world of difference between that case and this.
1. Mittal Steel is accused of being Indian. Mittal responds that this is a European Company.
2. There are a number of connections between Mittal Steel and the Indian government, including at least one meeting between Mittal and Manmohan Singh.
3. The Indian government announces that it is going to say something to the French PM. Mittal’s response to this interference that might undermine its position? NOTHING.
4. The Indian government goes ahead and talks to the French government. Mittal Steel’s response again … nothing.
I’m not saying that I have definitive proof that Mittal asked the Indian government to intervene. I have never said so. However, third parties actions are Mittal’s responsibility when he has foreknowledge of them and they work to his benefit and he has an incentive to disavow them if he is to make his position as head of a European company clear. Mittal steel is complicit in this.
That kind of evidence is never likely to exist, nor have I claimed that it does. However, that I am asserting is something quite routine, that a government intervened in a corporate matter. That I have established. Furthermore, I have established that he knew about it both before and after, and that he had an incentive to do something about it. It doesn’t matter if the Indian government did this on its own. What matters is that Mittal Steel, the EUROPEAN COMPANY, is getting assistance from the Indian government, and it is not distancing itself from that, which undercuts its position that IT IS NOT INDIAN.
And my pink unicorn is far from invisible. I can give you a list of XX Chromosomal types who have seen it and can testify to its existance.
Or Mittal was just busy closing his acquisition. Inaction to some international action proves nothing, we’d all be ‘complicit’ in the genocide in Darfur. I quote an unimpeachable source:
Mittal’s patient hostile takeover reminds me of Oracle’s long, and ultimately successful, pursuit of PeopleSoft. Look for a mass firing of the Arcelor execs who put their jobs ahead of their shareholders
Ironic observation in light of the fact that the same law firm represented both PeopleSoft and Mittal in their respective takeover battles.
It’s not direct evidence, but under these circumstances, Ennis lays out fairly plausible circumstantial evidence:
I might disagree with Ennis’s use of the terms “responsibility” and “complicit” as perhaps a bit too strong, but it seems rather clearly in the right ballpark — even if they didn’t seek Indian intervention, Mittal does seem to have acquiesced in the Indian government’s implicit position that Mittal Steel is an “Indian” company at some level, and he is therefore having it both ways to some extent. Otherwise, there is no real explanation for why he wouldn’t come out and say that he disavows that implicit position — given Mittal’s connections to the Indian government, it seems clear that they could have gotten the Indian government to stay quiet if they wanted them to.
(It reminds me at some level of the initial community responses to the Dotbusters violence in NJ, when community leaders reacted by going to the consulate, rather than the police/local government — subsequent responses instead sought to advocate with state/local officials directly, suggesting that the earlier approach undermined the claim of full inclusion as Americans.)
Now, where Manish’s and Ennis’s positions might be reconciled, at least a bit — or at least where it seems like you are talking past each other — is in the fact that while Mittal himself is apparently an Indian citizen, Mittal Steel is indeed a European corporation, with a separate — what’s really going on here might be (and I know very little about the ins and outs of the situation) that (1) Mittal Steel, a European corporation, is being treated differently from other European corporations on account of its non-European management/ownership, and simultaneously (2) the Indian government was interceding to protest any discriminatory treatment of Mittal himself, as one of its nationals. That still doesn’t mean that Ennis is wrong about Mittal himself having it both ways — if the corporation is an entity wholly controlled in practical terms by Mittal himself, then at least in substance, even if not in form, he probably is trying to have it both ways. But it does paint a more nuanced picture.
Actually, that’s a great example — it certainly proves acquiescene, if not “complicity.” But I might even make the claim for complicity if you get me riled up enough about genocide. :(
Regarding your comment in the Superman thread, I don’t think that Ennis is really “shifting the burden” — he’s just relying upon circumstantial evidence which you don’t find persuasive. As every juror in the country gets told before they deliberate, circumstantial evidence can be just as probative as direct evidence — for example, if Neha is buried deep in the bunker, generating blogpost after blogpost for hours on end, without seeing the light of day (slavedrivers), and Anna comes in wearing a raincoat, holding an umbrella, and soaked in water, it might well be appropriate for Neha to conclude that it is or was raining outside — even though she has no direct evidence of that.
(sorry for so many comments one after the other — will stop now.)
Mittal to build India steel plant
http://news.bbc.co.uk/2/hi/south_asia/5157092.stm