Rebel shareholders in steelmaker Arcelor secured a special vote today which could jeopardise the firm's plans to merge with Russia's Severstal and boost a rival takeover bid by Mittal Steel.
The rebels, concerned they may fail to gain 50 per cent support at a June 30th shareholders meeting to block the Russian deal, won the right to hold a second vote that day calling for another meeting in August to consider the deal under revised voting terms.
Arcelor's board said it saw the move as a spoiling tactic engineered by its rival. A vote in August would require two-thirds of the represented Arcelor shareholders -- rather than just 50 per cent -- to vote in favour of the €13 billion Russian tie-up.
Luxembourg-based Arcelor's management favours the Severstal deal as a white knight that would ward off Mittal's cash and shares bid - currently worth about €21.7 billion - which would combine the top two steel makers in the world.
Arcelor formally rejected Mittal Steel's €22 billion unsolicited takeover offer after its board met on Sunday but gave its management board the green light to talk to Mittal.
"Having noted that Mittal Steel recently indicated that it was prepared to further improve its offer in the context of a recommended transaction, the Arcelor Board has mandated the Group Management Board to meet with Mittal Steel," Arcelor said.
The meeting would "explore such possible improvements" to Mittal' bid. But Mittal said today it had no plans to improve the financial terms of its offer but was prepared to make changes related to corporate governance.
At 1012 GMT, Arcelor shares were trading down 1.10 per cent at €33.30 after an early rally, while Mittal shares were down 1.40 per cent at €23.90 .