Monday, June 26 2006 10:41 Hrs (IST) - World Time -

London: The Arcelor board's decision to accept Mittal Steel's merger offer is not only a personal triumph for Lakshmi Mittal but also symbolises the growing influence of Indian enterprise across trade and industry in the West.



Like the British media, which once vilified Mittal for using donations to the Labour party to expand his business but now lauds his acumen, Arcelor officials also effected a turnaround Sunday after they had earlier launched personal attacks on Mittal.



Earlier this year, Arcelor chief executive Guy Dolle had described Mittal's offer as having been made with 'monopoly money' and denigrated Mittal's products with, "They make eau de Cologne, we make perfume."

On Sunday, after a marathon day-long meeting of the Arcelor board, chairman Joseph Kinsch said, "In the end, it was decided unanimously by the Arcelor board that (it will) recommend the new offer by Mittal Steel," adding that Mittal's improved bid was a 10 percent premium over its previous offer. He is reported to have offered 43 euros per share in a fresh offer.

The setting up of the new company called Arcelor Mittal is the latest in the list of Mittal's long list of acquisitions over the years that stretches across continents. Of late, he has been ably assisted in securing mergers and acquisitions by his son, Aditya Mittal.



In recent years, Indian companies have not only been setting up offices in London and other Western business capitals but also entering into partnerships or acquiring prominent Western companies. The growing Indian influence is reflected in the Western media jettisoning its earlier Orientalist frame while reporting on India to one that is infused with respect for its strengths in economy, culture, democracy and a large pool of expertise.



Lakshmi Mittal, who turned 56 on June 15, was born in Rajasthan and studied in Kolkata before joining his father's interests in steel in Indonesia. He is Britain's richest resident, and continues to be an Indian citizen. His business plans include expansion in the steel sector in India, mainly in Jharkhand state.



On paper, Mittal and his family will own 43.6 percent of the capital of the new company - after the offer is accepted by Arcelor shareholders on June 30 - but no one is in any doubt who will be in the driving seat. It is only a matter of time - less than a year - before Mittal acquires majority shareholding in the company.



On Sunday night, the merger was presented as a 'merger of equals'.

Arcelor's current chairman Joseph Kinsch and chief executive Guy Dollé will keep their roles in the new dispensation while Mittal will become the group president. Four of the seven management positions will be filled by Arcelor directors.



But Mittal has clearly ensconced himself in the driving seat with 43.6 percent of the shares. He is likely to take on the chairmanship next year when Kinsch is due to stand down.

A delighted Mittal said after Arcelor announced its decision on Sunday night: "I am delighted that Mittal Steel and Arcelor have agreed to merge. This is one of the greatest days in the history of Mittal Steel and a seminal event in the steel industry that will shape its future.

"Arcelor is an exceptional company with world class assets and highly regarded management. I want to take this opportunity to express my gratitude to all of our employees, shareholders, and business partners for their support throughout this process of creating the best steel company in the world" he said.



"This combination is a natural alliance that represents a transformational change towards realising our vision of a more sustainable and stable industry benefiting all stakeholders. It is a winning combination between our two complementary companies, creating the industry leader that will create significant value for our shareholders," he said.

Arcelor Mittal will have a unique profile with unprecedented scale, scope and synergies.