Spain declares it is opposed to Mittal's bid to take over rival Arcelor

The Spanish government said Thursday that it opposes Mittal Steel Co.'s surprise 18.6 billion euros (US$22.5 billion) bid to take over rival Arcelor and that executives had failed to provide any new information that would convince them of the deal's merits. The announcement came after Mittal executives had expressed optimism that the company could overcome political and shareholder concerns.

Photo: Spain declares it is opposed to Mittal's bid to take over rival Arcelor

"Spain is not in favor" (of the deal), Finance Minister Pedro Solbes told Mittal's Chairman and CEO Lakshmi Mittal after meetings in the capital, according to a ministry spokeswoman.

"He (Lakshmi Mittal) gave no more details on his industrial and business plans at the meeting, nor those for employees," the spokeswoman said on condition of anonymity, since only the finance minister is authorized to speak to the media.

Spain became the third country to come out against the deal, following France and Luxembourg . But the ministry said Spain recognizes that a final decision on the takeover rests with Arcelor SA shareholders.

Spanish businessman Jose Maria Aristrain is Arcelor's second-largest shareholder, with a 3.5 percent stake, behind the state of Luxembourg, which has a 5.6 percent stake.

Earlier, Mittal's Chief Financial Officer Aditya Mittal the son of Lakshmi Mittal said that company officials have met with "key shareholders and institutional shareholders" since announcing the takeover bid last week.

"They have expressed their support for this transaction. They appreciate the industrial logic. They like the value-creation that this transaction offers," he said.

"The best example of their support is the stock market. You can see that Arcelor's stock price has considerably appreciated almost 30 percent since we announced the transaction. Even our stock prices, Mittal Steel, which is listed on the New York and Amsterdam exchanges, has improved."

Arcelor shares, which closed at 22.22 euros (US$26.95) on the day before the bid was announced, were trading at 29.35 euros (US$35.59) Thursday, up 0.4 percent. Mittal shares gained 0.03 percent Thursday to 29.70 euros (US$36.02) in Euronext trading ahead of the U.S. open, reports the AP.

D.M.