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Arcelor-Mittal

Arcelor-Mittal

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07/12/2013

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History
ArcelorMittal is a successor to Mittal Steel, a business founded in 1989 by Mr. Lakshmi N. Mittal, the Chairman of the Board of Directors and Chief Executive Officer of ArcelorMittal. It has experienced rapid and steady growth sinc e then largely through theconsis tent and disciplined execution of a successful consolidation-based strategy. Mittal Steel made its first acquisition in 1989,leas ing the Iron & Steel Company of Trinidad and Tobago. Some of its principal acquisitions since then include Thyssen Duisburg(Germany) in 1997, Inland Steel (USA) in 1998, Unimetal (France) in 1999, Sidex (Romania) and Annaba (Algeria) in 2001, NovaHut (Czec h Republic) in 2003, BH Steel (Bosnia), Balkan Steel (Macedonia), PHS (Poland) and Iscor (South Africa) in 2004, ISG(USA), Hunan Valin (China) and Kryvorizhstal (Ukraine) in 2005, three Stelco Inc. subsidiaries (Canada) and Arcelor in 2006.Arcelor was created in February 2002 by the c ombination of three steel-making companies: Ac eralia Corporación Siderúrgica("Aceralia"), Arbed and Usinor, to create a global presence in the steel indus try. At the time of its acquis ition by Mittal Steel in 2006,Arcelor was the second largest steel producer in the world in terms of production, with 2005 production of 46.7 million tonnes of steel and 2005 revenues of ¼32.6 billion. It operated in all key end markets : the automotive industry, construction, householdapplianc es, pack aging and general industry. Arcelor enjoyed leading positions in Western Europe and South America, in particular due to its Brazilian operations.In 2007, ArcelorMittal continued to pursue a disciplined growth s trategy, with a total of 35 transactions announced in Argentina,Austria, Canada, China, Estonia, Franc e, Germany, Italy, Mexico, Poland, Russ ia, Slovakia, South Africa, Turkey, the UnitedKingdom, Uruguay, the United States and Venezuela, a number of which were completed in 2007. During 2007, ArcelorMittal alsoannounc ed or completed buy-out offers for minority interests in certain of its subsidiaries in Argentina, Brazil and Poland.ArcelorMittal also initiated development plans for its greenfield projec ts in India, Liberia and Senegal and announced new prospective development projects in Mauritania, Mozambique, Nigeria, Russia, Saudi Arabia and Turkey.During the first eight months of 2008, ArcelorMittal continued making inves tments , with significant transactions announced inAustralia, Brazil, Canada, Cos ta Rica, France, Rus sia, South Afric a, Sweden, Turkey, United Arab Emirates, the United States, andVenez uela, the majority of which have been completed. During the last four months of 2008, Arc elorMittal largely suspendedmergers and acquisitions and other investment activities in light of the deteriorating economic and market environment.ArcelorMittal has proven expertis e in acquiring companies and turning around under-performing ass ets and believes that it hassucc essfully integrated its previous key acquisitions by implementing a "best practices" approach in operations and management toenhance profitability.Sinc e the acquis ition by Mittal Steel of Arcelor, a company of approximately equivalent s ize, the c ombined c ompany has reachedsignificant milestones in its operational integration process ahead of schedule, having consolidated support functions, optimised itssupply chain and proc urement structure and leveraged res earch and development s ervices across a larger base, thereby achievingcost savings and revenue synergies, as well as other synergistic benefits. As of 31 December 2008, Arc elorMittal had fully realis edits targeted $1.6 billion in s ynergies from the merger.ArcelorMittal has grown through the acquisition of numerous steel-making and other assets, which currently constitute its major operating subsidiaries . More rec ently, ArcelorMittal's acquisitions have been concentrated on v ertic al integration (i.e., acquisitions of raw material producers or production sites). ArcelorMittal's principal inves tments and acquis itions (including Greenfield projects),during the year ended 31 December 2008, are summarised below.The bulk of these acquisitions and investments were made prior to the sharp downturn in the steel market starting in September 2008. Since then the Company has sharply curtailed its M&A and investment activities and placed under review as a general matter its inves tment projects involving s ignificant capital expenditure, including those summarised below and those announc ed in prior years. Many of these projects, particularly "Greenfield" projects, (i.e., new-build construction projects) and large "Brownfield" projects (i.e., expansion or improvement of exis ting sites) are in any c ase subjec t to the rec eipt of various regulatory approvalswithout which implementation cannot begin. As dis cussed more fully in "Item 5-Operating and Financial Review and Prospects-Overview-Initiatives in Respons e to Changing Market Conditions", the Company has sharply reduced its anticipated capitalexpenditures for 2009 to $3 billion, of which $2.5 billion is for maintenanc e.
History of Mittal Steel
Mittal Steel's growth was founded on a consis tent philosophy: that to be able to deliver the range and quality of products customersdemand the modern steel maker must have the scale and worldwide pres enc e to do so competitively.The group was formed when two sister c ompanies in the Mittal family , LNM Holdings and ISPAT International, were merged to formMittal Steel in 2004.Mittal Steel Growth Timeline
 
 
2005:
Acquis ition of a stake in Hunan Valin > ISG Acquisition c ompleted > Mittal Steel Europe created > Mittal Steel makes Fortune500 list of top companies> MDA with Liberian government > Acquisition of Kryvorizhstal > MoU with State of Jharkhand, India >Acquisition of Stelc o subsidiaries > Stake lifted in Mittal Steel Zenica
2004:
Acquis ition of Polski Huty Stali > Ac quisition of BH Steel > Acquisition of Mac edonian facilities from Balkan Steel > Creation of Mittal Steel and proposed acquisition of International Steel >
2003:
Acquis ition of Nova Hut
2002:
Business as sistanc e agreement signed with Iscor 
2001:
Acquis ition of ALFASID > Acquisition of Sidex
1999:
Acquis ition of Unimétal
1998:
Acquis ition of Inland Steel Company
1997:
Ispat International NV goes public
1995:
Acquis ition of Hamburger Stahlwerke > Ispat International Ltd. and Ispat Shipping formed > Acquisition of Karmet
1994
: Acquisition of Sidbec-Dosco
1992:
Acquis ition of Sibalsa
1989:
Acquis ition of Iron & Steel Company of Trinidad & Tobago
History of Arcelor
Arcelor was created through the merger of Arbed (Luxembourg), Aceralia (Spain) and Usinor (France). The three European groupswere determined to mobilis e their tec hnical, industrial, and commercial resources in order to create a global leader in the s teelindustry.The merger was officially launched on 19 February 2001 and the choice of the Arcelor name was announced on 12 December 2001.The merger became effective on 18 February 2002 when Arcelor shares were listed on several stock exc hanges.Arcelor Highlights 2002- 2006
y
2006
y
2005
y
2004
y
2003
y
2002Founding c ompanies of Arcelor 
y
Chronology Arbed
y
Chronology Ac eralia
y
Chronology Usinor 
The Merger Process
2006 was a very exciting and challenging year for Arc elorMittal. The new company was at the forefront of the consolidation process,leading the industry through mergers and acquisitions.
 
 
January 2006 Historic moment for the Global Steel Industry
The year started with the historic launch of the Mittal Steel offer to the shareholders of Arc elor to create the world's first 100 milliontonne plus steel produc er. The aim of increasing globalisation and consolidation, necess ary in the steel industry, defines the dealand s ets the pac e for the industry.
February 2006 - Expansion and strong results
Mittal Canada c ompletes the acquisition of three Stelc o subsidiaries , the Norambar and Stelfil plants, loc ated in Quebec, and theStelwire plant in Ontario. Stelfil and Stelwire will add 250,000 tonnes of steel wire to the company's annual produc tion c apacity, providing a wider product mix to better meet customers' needs.Arcelor acquires a 38.41% stake in Laiwu Steel Corporation, in China. Laiwu Steel Corporation is China's largest produc er of sections and beams, and will further boost its operational excellence thanks to this partnership. It is still awaiting approval with theBeijing authorities.
April 2006 - Renewal after Hurricane Katrina and new galvanised line
Out of the devas tation of Hurricane Katrina, aros e a revitalised Miss is sippi youth bas eball field, rebuilt with the help of Mittal SteelUSA and Arcelor. The company provides money towards the purchas e of lighting fixtures and steel cross bar support. It als oarranges for and donates the labour costs for their installation.Mittal Steel USA places a new line into operation in Cleveland to prov ide top-quality galvanised sheet steel to automakers and other demanding customers. The new line is designed to produce in excess of 630,000 tonnes of corrosion-resis tant sheet annually, us ingthe hot-dip galvanising process.
May 2006 - US clears the way for bid
Mittal Steel announces US antitrust clearance for Arc elor bid and the approval of the offer documents by European regulators. Theacceptance period s tarts in Luxembourg, Belgium and France on 18 May 2006 (some days later for Spain and the United States )and las ts until 29 June 2006.Arcelor c ontributes to the first anti-seismic s chool building in Iz mit (Turkey), where a school building had been des troyed by anearthquak e in 1999.
June 2006 - Historic agreement to create the No.1 Global Steel Company
Creating the world's largest steel company, Mittal Steel and Arcelor reach an agreement to c ombine the two companies in a merger of equals. The terms of the transaction were reviewed by the Boards of Arcelor and Mittal Steel which each recommended thetrans action to their shareholders. The c ombined group, domiciled and headquartered in Luxembourg, is named Arc elor Mittal.Demons trating the c ommitment to extend markets in developing nations, a strategic partnership between Arc elor Mittal and SNI(Société Nationale d'Investis sement) is concluded c oncerning the development of Sonasid. This consolidates and develops the position of Sonasid on the Moroccan market, allowing the company to benefit from the transfer of Arc elor Mittal's tec hnologies andskills in the long carbon steel product s ector.
September 2006 - New dividend policy
Arcelor Mittal announc es new dividend polic y, under whic h it will pay out 30% of net income annually.93.7% of Arcelor shareholders tender their shares to Mittal Steel.Arcelor Mittal confirms Value Plan up to 2008.

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