Abstract

The case discusses the three-way merger between steel majors LNM Holdings, Ispat International and the International Steel Group. The merger, that was to be completed by early 2005, was poised to create the biggest company in the global steel industry, with a strong presence in the US, Europe and Africa. The new company, called Mittal Steel, was expected to have considerable resources of iron and coal and a total annual production capacity of 70 million tons. The case discusses the various issues related to the merger, including the financial implications and HR issues, as well as the potential strategic and operational benefits that the companies hoped to achieve. The general trends and issues in the global steel industry are also discussed to provide a holistic view of the industry.

Learning Objectives

The case is structured to achieve the following Learning Objectives:

• Analyze the synergies expected from the merger
• Examine the various issues in the merger and the manner in which the parties dealt with them
• Appreciate the need for and importance of consolidation and vertical integration in the global steel industry in the light of the problems facing it.

Keywords

Mittal Steel, Ispat International, LNM Holdings, International Steel Group (ISG), L.N.Mittal, Wilbur Ross, Mergers and Acquisitions, Global Steel Industry, United Steel Workers of America (USWA), Legacy Costs, Arcelor SA, Posco, Shanghai Baosteel Group, Nippon Steel and Global Steel Production