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Arcelor Mittal Clarifies Position on US Divestments

09/29/2006 -  

Sep. 29, 2006 — Arcelor Mittal issued a press statement to clarify several statements reported in the press regarding its consent decree with the US Department of Justice.

Strategic Steel Stichting

The Arcelor group transferred its shares in Dofasco to an independent Dutch foundation named "Strategic Steel Stichting" (S3), effective April 3, 2006.

Arcelor undertook this action in order to retain full control over Dofasco, including all decision-making power and all economic interest relating to Dofasco, with the exception of any decision to sell Dofasco.

S3 Board members were to have independent control over any decision to sell Dofasco with a view to protecting the interests of Arcelor, its integrity and its stability. S3 was to be in place for at least five years unless the S3 Board decides to dissolve it.

See the related steelnews.com article for additional information.

Mittal Steel says that it remains committed to divesting Dofasco to ThyssenKrupp pursuant to both its January 26, 2006 agreement with ThyssenKrupp and Mittal's agreement with the US Department of Justice (DOJ). Mittal Steel is continuing to use its best efforts, as required by the consent decree with the DOJ, to divest Dofasco.

Under the US consent decree, if the company is unable to sell Dofasco to ThyssenKrupp due to Arcelor's April 2006 transfer of its Dofasco shares to the S3 Stichting, it must sell an alternative asset—either its Sparrows Point plant in Maryland or its Weirton, W.Va., plant—in order to address the competitive concerns. The choice of which plant would be sold in that situation would be made by the US DOJ in its sole discretion.

The company has informed the DOJ that if it cannot sell Dofasco because of the S3 Stichting, and is therefore required to divest either Sparrows Point or Weirton, it prefers to divest Weirton. The DOJ, however, has not informed the company which plant it would select under these circumstances.

Arcelor Mittal is the world's leading steel company in terms of revenue and production. The company operates 61 plants across 27 countries, employing some 320,000 employees.