The Mittal Steel-ISG Merger - Creating a Steel Behemoth (Part-A)
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Case Code: BSTR147 Case Length: 12 Pages Period: 2004 Pub Date: 2005 Teaching Note: Available |
Price: Rs.400 Organization: Mittal Steel Industry: Steel Countries: UK, USA Themes: Merger and Acquisition |
Abstract Case Intro 1 Case Intro 2 Excerpts
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.
Issues
The case is structured to achieve the following teaching objectives:
- Understand the factors behind the creation of the biggest steel company in the world
- 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
Contents
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A New Steel Giant
Background Note
The Proposed Merger
The Reactions
The Outlook for the Steel Industry
Exhibits
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
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