Mittal Steel makes a hostile takeover bid for Arcelor; France resists

[aneeshm]

Lakshmi Mittal , of Mittal Steel , has made a hostile takeover bid for his closest rival Arcelor .

News links about the bid from

The Guardian
The BBC

For some reason , France and Luxembourg are apprehensive about the bid . They are grasping at straws to keep ownership . It has gone to the point where some people said that "monkay man" was taking over Arcelor . Others made cartoons depicting Mittal as Mohammed ( like the Danish ones ) , saying that "Mohammed has taken over Arcelor" .

The market has already spoken ( the value of both companies rose by $ 25 billion after news of the bid ) in facour of the bid . Mittal claims that the shareholders support him .

To me , this opposition smacks of racism ( specially when the part where the Arcelor CEO slams the phone down on Mittal when Mittal called him ) .

Your thoughts ?

[notyoueither]

Where are the 'monkey' comments?

[Saras]

Chairman of Arce3lor said this was "Monkey Money" taking it over. NOT nice. And VERY French enarque'ist

[Urban Ranger]

Re: Mittal Steel makes a hostile takeover bid for Arcelor; France resists

Originally posted by aneeshm
The market has already spoken ( the value of both companies rose by $ 25 billion after news of the bid ) in facour of the bid . Mittal claims that the shareholders support him.

Usually, the stock price of the target will raise while the stock price of the attack drops.

If it moves up something may be fishy.

[Maniac]

Re: Mittal Steel makes a hostile takeover bid for Arcelor; France resists

France doesn't want to be colonized by foreign powers. Surely you should be able to understand that?

[Saras]

[axi]

Is this in any way connected with France being forced to recall their old aircraft carrier, which had arrived in India to get scrapped?

Is it some kind of Gaullism? Something like: "If you don't want that chunk of steel, you're not getting ANY steel from us?"

[Fake Boris]

On a related note, India still imposes a 60% tariff on foreign cars.

[Saras]

Protectionism

[Spiffor]

No. The opposition to Mittal's takeover was on track well before the Clemenceau set back to France.

Basically, we have some remnants of Gaullist industrial policies (Chirac's political background is full of Gaullist worldview), where the conglomerates are still seen as "national champions", i.e. something related to the state. A takeover of our national champion by a foreign power isn't very popular among our gaullist leaders (unlike the liberal leaders, who don't care).

But the foreign-ness of Mittal isn't the only thing that explains France's opposition to the takeover. We already had several "national champions" whose foreign takeover was allowed by the authorities. Mittal has also provided no guarantee about employment, and has provided no industrial project. Considering that several profitable industrial ventures have been ruined by "rogue bosses" (who were pilfering the company for immediate financial gain), and that it's always very covered by the press, we don't need that as a country, and Chirac doesn't need that as a fragile politician.

[aneeshm]

Originally posted by Oncle Boris
On a related note, India still imposes a 60% tariff on foreign cars.

Agricultural subsidies . . . . . . .

[Colonâ„¢]

IIRC an Indian court also forbade the ship to enter Indian territory.

Originally posted by Spiffor
No. The opposition to Mittal's takeover was on track well before the Clemenceau set back to France.

Basically, we have some remnants of Gaullist industrial policies (Chirac's political background is full of Gaullist worldview), where the conglomerates are still seen as "national champions", i.e. something related to the state. A takeover of our national champion by a foreign power isn't very popular among our gaullist leaders (unlike the liberal leaders, who don't care).

But the foreign-ness of Mittal isn't the only thing that explains France's opposition to the takeover. We already had several "national champions" whose foreign takeover was allowed by the authorities. Mittal has also provided no guarantee about employment, and has provided no industrial project. Considering that several profitable industrial ventures have been ruined by "rogue bosses" (who were pilfering the company for immediate financial gain), and that it's always very covered by the press, we don't need that as a country, and Chirac doesn't need that as a fragile politician.

Except that Arcelor isn't a French "national champion". The HQ is in Luxembourg, the only govt's holding stock in it are those of Luxembourg and Wallonia, and France is only one of several countries were a lot of activities are concentrated (others being Belgium, Spain, Italy, Brazil...). The CEO is French but the rest of the management board isn't.

Really, France can go and screw themselves over this.

[Spiffor]

Originally posted by Colonâ„¢
Except that Arcelor isn't a French "national champion". The HQ is in Luxembourg, the only govt's holding stock in it are those of Luxembourg and Wallonia, and France is only one of several countries were a lot of activities are concentrated (others being Belgium, Spain, Italy, Brazil...). The CEO is French but the rest of the management board isn't.

That's no matter.

In the mind of the French voter, it is a French national champion. And Chirac can try to convince other governments, that are closer to Arcelor's decision-structure, to make an effort against the takeover as well. For example, Luxembourg is already opposed to it. Also the EU has decision power about takeovers.

Politics can have influence on the takeover, and the issue is salient in French politics. Ergo, Chirac's resistance to the takeover isn't as irrelevant as you'd wish.

[Fake Boris]

Sincerely agricultural subsidies are another story because everyone has them and thus the dynamic about them is different.

If India is strong enough to overtake steel giants, then it's strong enough to open itself to car competition.

[DanS]

Except that Arcelor isn't a French "national champion". The HQ is in Luxembourg

Which is part of Greater France!