Mittal denies Posco bid reports

Arcelor Mittal CEO Lakshmi N Mittal today described as speculative the reports of the world’s largest steel maker looking to acquire South Korean rival Pohang Steel Company...

Arcelor Mittal CEO Lakshmi N Mittal today described as speculative the reports of the world’s largest steel maker looking to acquire South Korean rival Pohang Steel Company (Posco). “These are all speculations,” the India-born billionaire told reporters here.

The Korea Economic Daily had reported on March 16 that Arcelor-Mittal was mulling a hostile takeover of Posco and that a message about Arcelor Mittal’s interest had been conveyed to the Korean major last month. The paper had said that Roland Junck, an adviser to Mittal, had in February asked Posco specific questions about its merger and acquisition strategies in Asia.

However, Mittal’s son and company CFO Aditya Mittal told CNBC television on Friday, “We are friendly with Posco and we are working with them to further alliances in technology.” A merger or acquisition was not on the agenda, he had said.

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Arcelor Mittal has been planning to expand in Asia and has made attempts in China, but with moderate success. It also plans to build a greenfield steel plant in India, but has failed to make much progress so far. Incidentally, Posco too is planning to build a mega steel project in Orissa.

Expressing concern at the slow progress of its proposed steel plants in Jharkhand and Orissa, Mittal said, “Speed is a problem and we are in talks with the states and the Centre to sort out issues on land acquisition.” Arcelor Mittal has proposed to invest Rs 40,000 crore for building a 12 million tonne integrated steel project either in Jharkhand or Orissa.

Allaying fears of an unusual steel price increase, Mittal admitted that the prices have shot up due to an increase in input costs but argued that there was nothing unusual about this.