Mittal and Arcelor Merger Likely

Shareholders of steelmaker Arcelor seem to be lining up behind Mittal Steel’s offer to buy the company, and the arrangement has also gained approval from the government of Luxembourg, according to a Reuters report.

Several shareholders expressed displeasure with an Arcelor management plan to merge instead with Russia’s Severstal. A vote that will likely terminate that proposed deal is scheduled for Friday, June 30.

According to Reuters, after months of resistance and negotiation, Arcelor’s board has decided to recommend that shareholders accept Mittal’s offer to purchase Arcelor for more than 24.6 billion euros.

The government of Luxembourg, which owns more than 5 percent of Arcelor’s shares, has also announced its support of the deal, following earlier proclamations of opposition.

A merger between Mittal and Arcelor will create what will be by far the world’s largest steelmaking firm, with annual production capacity of more than 100 million tons. That total represents nearly 10 percent of estimated overall global steel production capacity.