IISI, Steel Industry Renew Call for Review of BHP-Rio Tinto Alliance
02/20/2008 - Representing the interests of steel producers worldwide, the International Iron and Steel Institute renews its formal request that all relevant competition authorities review the proposed alliance between BHP Billiton and Rio Tinto.
The International Iron and Steel Institute (IISI) has renewed its formal request that all relevant competition authorities review the proposed alliance between BHP Billiton and Rio Tinto.
“Following the recent tabling of a revised formal offer from BHP Billiton for Rio Tinto we are again calling on competition authorities to seriously examine the obvious implications for future pricing regimes and the competitive environment for iron ore,” said IISI Secretary General Ian Christmas, speaking on behalf of steel producers worldwide.
“We note comments published in the media that price will be a key element in the outcome of this bid,” said Christmas. “In our view, it is wrong to focus on a theoretical price of purchase; a far more critical issue is the inevitable rise in prices this merger would bring following such an elimination of competitive choice. This merger is not in the public interest and should not be allowed to proceed.”
Concluding, Ian Christmas said: “As we said in our first statement, IISI supports free and fair trade in steel. Competition between steel companies promotes innovation and efficiency. It promotes the growth in steel use and serves steel’s customers and society as a whole. IISI has also supported the consolidation of steel businesses but not to the extent of endangering competition. Even the largest steel company in the world today accounts for less than 15% of total world steel production. We stand ready to provide access to our data to help competition authorities review the impact of such a merger.”
