SEVERSTAL N. AMERICA HEADLINESSteel Producers /
Severstal N. America
Arcelor Shareholders Reject Proposed SeverStal Merger
Jul. 3, 2006
July 3, 2006 — The extraordinary shareholders meeting of Arcelor has resolved to reject the proposed SeverStal merger.
|
Severstal notes that Mr. Mordashov was encouraged and gratified by the positive feedback he received about Severstal during the process from many Arcelor shareholders and stakeholders.
According to Severstal, the experience has greatly raised Severstal's profile and standing within the investment community. The company notes that Mr. Mordashov continues to assess all of his strategic options.
|
|
Approximately 96% of the shares present or represented at the meeting (representing 58% of Arcelor’s outstanding share capital) voted against the proposed SeverStal merger. Based on this result, Chairman Joseph Kinsch stated that the strategic alliance agreement with Mr. Mordashov will be terminated in accordance with the terms of that agreement.
A second resolution had been added to the agenda of the shareholders meeting regarding a further shareholders’ meeting to approve the proposed SeverStal merger. The resolution had been added at the request of persons who claimed to be shareholders that collectively held more than 30% of Arcelor’s share capital. However, the participants making the request did not represent 30% of Arcelor's outstanding share capital, as claimed, but less than 20% of the share capital. Since 20% is the minimum threshold provided by the Luxembourg law, the proposed resolution was withdrawn from the agenda.
Arcelor holds leadership positions in its main markets: automotive, construction, household appliances and packaging as well as general industry. The company endeavors to further expand internationally in order to capture the growth potential of developing economies and offer technologically advanced steel solutions to its global customers. In 2006, Arcelor employs 110,000 associates in over 60 countries. The company places its commitment to sustainable development at the heart of its strategy and ambitions to be a benchmark for economic performance, labor relations and social responsibility.
SeverStal is the largest Russian steel producer, with 2005 steel production of 17.1 million tonnes. It is the second largest flat steel producer in Russia with annual steel production of 10.9 million tonnes. In addition, SeverStal owns Severstal North America, the fourth-largest integrated steelmaker in the U.S. with 2005 production of 2.7 million tonnes, and Lucchini, Italy's second-largest steel group with 2005 production of 3.5 million tonnes. The SeverStal Group is one of the world's lowest cost and most profitable steel producers, with 2005 EBITDA per tonne of approximately EUR150 per tonne. SeverStal-Resource owns 70 years of iron ore reserves and 84 years of coal reserves. SeverStal-Resource produces coking coal, thermal coal, iron ore pellets and iron ore concentrate.