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Arcelor S.A.
Type subsidiary
Founded Arbed in 1911
Aceralia in 1902
Usinor in 1948
Arcelor on 18 February 2002
Headquarters Flag of Luxembourg.svg Luxembourg City, Luxembourg
Key people India Lakshmi Mittal, CEO of the Arcelor Mittal group
Industry Steel
Products Steel
Revenue € 32.611 billion (2005)
Employees 94,000
Website www.arcelor.com

Arcelor S.A. was the world's largest steel producer in terms of turnover and the second largest in terms of steel output, with a turnover of €30.2 billion and shipments of 45 million metric tons of steel in 2004. The company was created by a merger of the former companies Aceralia (Spain), Usinor (France) and Arbed (Luxembourg) in 2002.

Arcelor is now part of Arcelor Mittal.

Contents

Business

Employing 310,000 employees in over 60 countries, it is a major player in all its main markets: automotive, construction, metal processing, primary transformation, household appliances, and packaging, as well as general industry. With total sales of over €30 billion, Arcelor is the world's largest steel manufacturer in terms of turnover. It produces long steel products, flat steel products and inox-steel. In January 2006 Arcelor announced the acquisition of Dofasco, Canada's largest steel producer with an annual output of 4.4 million tons. After an intense bidding war against the German ThyssenKrupp, Arcelor had finally bid 5.6 billion Canadian dollars. The high bid proves the importance of Arcelor's improving presence in the North American market.

Merger with Mittal Steel

The company was the target of a takeover bid by its rival Mittal Steel on 2006-01-27.[1] However, the bid resulted in substantial increase in Arcelor's share value. Two members of the board of Arcelor, Guillermo Ulacia and Jacques Chabanier also resigned suddenly.[2] On May 26, 2006 Arcelor announced its intention to merge with Severstal. Since then several economists, media and shareholders have questioned the intentions of Arcelor in announcing its merger with Severstal due to a perceived opacity in the transaction. But on 25 June 2006, the Arcelor board decided to go ahead with the merger with Mittal Steel and scrapped plans for Severstal merger. The new company is now called "Arcelor Mittal". Arcelor also paid Severstal €140 million as a "fine" for the fall-out of their failed talks. Lakshmi Mittal (owner of Mittal Steel) became the president and Joseph Kinsch (formerly Arcelor chairman) was appointed chairman of the new company till his retirement.[3][4] Arcelor's merger with Mittal created the worldwide leader in the steel industry, increasing its bargaining power with suppliers and consumers. Mittal steel has agreed to pay 40.37 euros a share to Arcelor, almost double the amount offered by Mittal last time.

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Reaction to the takeover

Arcelor's directors strongly opposed the takeover, with Arcelor's chief executive at that time, Guy Dollé, even dismissing Mittal as a "company of Indians".[5] The French, Luxembourg and Spanish governments strongly opposed the takeover. The Belgian government on the other hand declared its stance as neutral and invited both parties to deliver a business plan with the future investments in research in the Belgian steel plants. The French opposition was initially very fierce and has been criticized in the British, American and Indian media as double standards and economic nationalism in Europe. Indian commerce minister Kamal Nath warned that any attempt by France to block the deal would lead to a trade war between India and France.[6]

On June 20, the above claim by economists was confirmed when Severstal increased its valuation of Arcelor. Management of Arcelor had in fact undervalued the company itself. The capability of management which had openly supported the previous valuation of Arcelor came into question. Further the combined markets of France, Belgium, Luxembourg and Spain chided Arcelor management and suspended trading of its stock.

On June 26, the Board of Directors recommended the approval of the improved Mittal offer (49% improvement compared to the initial offer with 108% improvement of the cash component), proposed the creation of Arcelor-Mittal with industrial and corporate governance model based on Arcelor and scheduled a corporate meeting for June 30 to vote on this.

Products

The products of Arcelor are divided into three groups: Flat steel products, long steel products and stainless steel.

Flat steel products

The main production sites of flat steel products are Ghent-Zelzate, Dunkirk, Avilés, Gijón, Fos-sur-Mer, Piombino, Liège, Florange, Bremen, Eisenhüttenstadt and recently São Francisco do Sul in Brazil.

See also

External links

References

[7]

  1. ^ "Arcelor Board of Directors unanimously rejects Mittal's hostile proposal" retrieved from Arcelor.com on 2006-02-07
  2. ^ "Management Board". Arcelor.com. http://www.arcelor.com/index.php?lang=en&page=49&tb0=127. Retrieved 2006-02-07.  
  3. ^ Arcelor agrees to Mittal merger on International Herald Tribune
  4. ^ Arcelor, Mittal decide to merge: Reports on Rediff.com
  5. ^ "The struggle for Arcelor steel (editorial)". The International Herald Tribune. 2006-06-04. http://www.iht.com/articles/2006/06/04/opinion/edarcelor.php.  
  6. ^ "India, EU back Mittal's bid on Arcelor". hindustantimes.com. http://www.hindustantimes.com/news/181_1615241,00020008.htm.  
  7. ^ Lakshmi Mittal, the king of steel - Agarwal Today Special Report

Aceralia
Industry Steel
Predecessor Corporacion de la Siderurgia Integral (1991)
formed from
Ensidesa (1950)
Altos Hornos de Vizcaya (1902)
Successor Arcelor
Founded 1997
Defunct 2002
Website www.aceralia.es

Aceralia was a large Spanish steel producer formed in 1997 by restructuring of a group formed from earlier mergers of the steel producers ENSIDESA and Altos Hornos de Vizcaya.

The company merged into Arcelor in 2001, and became part of ArcelorMittal in 2006.

Contents

History

ENSIDESA

In 1950 the state owned company Empresa Nacional Siderúrgia Sociedad Anónima (ENSIDESA) was formed to increase Spain's steel production[1], part of the industrialisation and modernisation of Spain that led to the Spanish economic miracle of the 1960s.

In 1973 the state owned company was forced to take over the Asturian steel company UNISA, which had invested heavily in a fully integrated steel works and did not have the capital to fund it.[2]

Aceralia

In 1991 the state owned company ENSIDESA was merged with Altos Hornos de Vizcaya to form the Corporacion de la Siderurgia Integral from which the Corporación Siderúrgica Integral (CSI) was formed in 1994 from the more profitable parts (as part of a privatisation process).[1]

In 1997 Aceralia Corporación Siderúrgica was formed by reorganisation of CSI, the same year the company formed a strategic alliance with the Luxembourg based steel group Arbed.[1] As soon as it was formed it was also privatised.[3]

The group also acquired the Aristrain Group (steel sections), and Ucín (rebar, wire rod), in the process becoming the largest steel company in Spain.[1]

In 2001 the company merged with two other European steel producers; Arbed, and Usinor to form Arcelor.[4]

References

[[File:|thumb|Aceralia torpedo train in El Valle, Asturias]]

  1. ^ a b c d "History of Aceralia". www.arcelormittal.com. ArcelorMittal. http://www.arcelormittal.com/index.php?lang=en&page=550. 
  2. ^ Pierangelo Maria Toninelli, p.222
  3. ^ Pierangelo Maria Toninelli , pp.218 & 222
  4. ^ "History of Arcelor". www.arcelormittal.com. ArcelorMittal. http://www.arcelormittal.com/index.php?lang=en&page=540. 

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