At a joint press conference with Arcelor Chairman Joseph Kinsch, he exuded confidence of having the support of shareholders as well as the Board of Arcelor.
LUXEMBOURG: A day after clinching the deal with Arcelor, India-born steel tycoon L N Mittal on Monday expressed confidence that shareholders will vote in favour of the agreement and reject Russian giant Severstal's offer of a merger.
At a joint press conference with Arcelor Chairman Joseph Kinsch, he exuded confidence of having the support of shareholders as well as the Board of Arcelor.
On Severstal's plans to improve its bid, Mittal said: "Any partial bid will not be entertained by the company".
Mittal's son Aditya appealed to shareholders of Arcelor to vote down Severstal's merger plan to keep the Arcelor-Mittal tie-up on track.
Earlier, a slighted Severstal, with whom Arcelor announced a merger on May 26, expressed surprise at not being invited to Sunday evening's Board meeting and declared that it would present an improved offer to shareholders of Arcelor on June 30.
The newly-created entity Arcelor-Mittal would have L N Mittal as its President, while Joseph Kinsch would continue to be in the position of Chairman till his retirement.
"Initially, the Chairman position will be held by Kinsch and the President position will be held by Mittal. Upon the retirement of Kinsch, Mittal will assume the role of Chairman and the successor to the President will be proposed by Kinsch," the two companies said at the press conference.
Arcelor CEO Guy Dolle has offered to step down and a new CEO is likely to be announced on June 30. Mittal suggested that Kinsch should propose a replacement candidate.
Terming the deal as a "merger of equals" to create a truly global leader in the steel sector, Aditya, son of L N Mittal and CFO of Mittal Steel, said he was surprised by the "positive attitude" of the members of Arcelor management Board during the last ten days of negotiations.
Arcelor had tried to fend off bid from Mittal for over five months, terming it as unsolicited and hostile.
Aditya said the new entity (Arcelor-Mittal) would have exceptional raw material availability in terms of iron ore among others, for which Mittal had improved by seven per cent, its previous offer presented last month, and taking into account the dividend, the improvement works out to 10 per cent.
"The creation of the new entity would reduce volatility in the market... it would be a supplier of a key range of products," said Aditya, who could become the CFO of the merged entity. The merged company would be able to fund future investments comfortably, he added.
Kinsch said that Arcelor would honour all its existing contracts with Severstal, but not expand further businesses with it.
He also said that Arcelor would pay 140 million euros to Severstal for breach of contract.
Having spread its footprint across the globe, Mittal said the new entity would strive to expand its presence in the emerging markets including India and China.
"Now its time that both companies sit together and decide on a larger Chinese footprint," Mittal said, adding "the new entity will focus on emerging markets, like India and China."
The new company would control nearly 10 per cent of global steel production, churn out 120 million tonnes of crude steel annually and employ 3,20,000 people, besides have a market capitalisation of $46 billion.
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