Luxembourg thwarts Mittal bid

By agencies   |   Thursday, 23 March 2006, 08:00 Hrs
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LUXEMBOURG: Lawmakers in the tiny European country of Luxembourg approved a change in the country's takeover rules that could threaten Mittal Steel's €19 billion bid for Arcelor.

After an outcry over the unsolicited bid launched in January, the finance committee yesterday backed a change which would prevent a bidder from re-submitting a takeover offer for a listed company in Luxembourg for a period of 12 months.

A source close to the deal said the change could hurt Mittal if Arcelor moves to defend itself, for example by issuing more shares, forcing Mittal to seek to re-submit its bid.

"This could be used as a poison pill," the source said.

Arcelor itself has been fighting against the offer, saying it undervalues the company and shareholders would not back it.

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