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Posco next on Mittal's list
By siliconindia
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Friday, 16 March 2007, 17:30 IST
New Delhi: If you had felt that buying out Arcelor would satiate Lakshmi Mittal's appetite, you are bound to give it a second thought. Now, Mittal could be eyeing another big-ticket acquisition, South Korea's steel giant Posco., reported CNN-IBN today.
According to reports in the South Korean economic daily, Arcelor Mittal could be in the process of launching a hostile takeover for Posco.
However, South Koreas POSCO, the worlds third largest steelmaker, said that it is stepping up its defences to thwart any hostile takeover attempt amid reports Arcelor Mittal is looking at the company.
"The company will acquire more friendly shares for stable management," a POSCO official said adding that shareholders counted as friendly to the management now controlled 40 percent of the company. "This will help POSCO thwart a possible takeover bid by foreign firms."
In January, shareholders approved POSCOs proposal to ease rules on selling new shares to strategic partners following talks between chairman Lee Ku-Taek and Arcelor Mittal senior executive Roland Junck.
Arcelor Mittal, the worlds biggest steelmaker and POSCO are jostling for dominance in the rapidly growing Asian markets led by China and India.
On Friday, the Korea Economic Daily quoted an unidentified POSCO executive as saying Junck had expressed an interest in POSCOs strategy concerning mergers and acquisitions. POSCOs management is studying how to react to a possible bid from Arcelor Mittal, it added.
POSCO said on16 March there had been no discussion of a merger or acquisition with Arcelor Mittal.
The South Korean company forged an alliance with Japans Nippon Steel, the worlds second largest steeelmaker after Arcelor Mittal, in 2000 to position itself better for a global realignment in the industry.
In October last year, they agreed to increase stakes in each other after Mittal Steel acquired rival Arcelor of Luxembourg to create the worlds largest steel group.