Setback for Mittal Steel: Arcelor board rejects bid
Mittal Steel is the worldâ€™s largest manufacturer of Steel and the company just recently unveiled their bid to acquire the second largest producer of steel in the world with the aims of consolidating the market.
However, the company has received a setback as the board members of the Arcelor have unanimously rejected the $23 billion (13 billion pound) hostile takeover bid. The board members talked about their concerns related to possible job losses and differences of opinion over strategy.
The company said in a statement on their rejection of the bid from Laxmi Mittal who also happens to be the richest Indian in the world as per the Forbes list. The Arcelor board also recommended their shareholders not to sell away their shares to the Mittal Steel Company to protect the interests of the company.
Arcelor is now scheduled to hold a press conference on Monday in Paris where they would be giving out more details on rejecting the bid from Mittal Steel. Mittal Steel is also scheduled to hold a press conference on Monday at 10:30 a.m. British time in Paris.
The bid was very lucrative at a price of 28.21 euros a share, which is around 27 percent above the current price of the share of Arcelor in the stock market before the bid was made. The companyâ€™s decision to reject the bid is supported by the Luxembourg’s government who holds a 5.62 percent stake in the company.