Skip to comments.France fighting Mittal because he's Indian?
Posted on 02/03/2006 12:22:56 AM PST by CarrotAndStick
Paris, February 3: France's opposition to Mittal Steel's bid for Arcelor is not due to the fact that its owner is Indian-born, Finance Minister Thierry Breton said on Thursday, brushing off alleged French arrogance towards an outsider.
France's conservative government and the Socialist opposition have stepped up rhetoric against steel magnate Lakshmi Mittal's $24 billion bid for Arcelor, sparking criticism by an Indian minister and some commentators.
"This has nothing to do with India or anyone else," Breton told Europe 1 radio. "This is a European company. The nationality of the shareholders has nothing at all to do with this. I appeal to everyone to be reasonable."
France, where more than 26,000 jobs could be affected by a takeover, has condemned the hostile offer for Arcelor -- the product of a three-way merger four years ago between Spain's Aceralia, France's Usinor and Luxembourg's Arbed steel firms.
If the bid succeeds, Prime Minister Dominique de Villepin will have little to show for a year-long campaign to prevent hostile foreign takeovers through a policy known as economic patriotism.
Breton has said he has profound concerns about both the form and content of the offer and that it was poorly prepared. French Industry Minister Francois Loos described Arcelor on Wednesday as "a flower of the European economy" and told parliament that France was opposed to the takeover.
Criticism of France
Although Arcelor executives and French ministers have mainly focused on criticising the protocol of the sudden bid, rather than the origin of the bidder, criticism about France's arrogance towards a foreign outsider has risen. India's Commerce Minister, Kamal Nath, said India was concerned about French opposition to Mittal's bid.
"We are watching the comments of the French government very carefully," he said on Wednesday after meeting European Trade Commissioner Peter Mandelson in London.
French newspaper Liberation asked whether the affair might become a diplomatic incident between France and India.
"France...is complaining about the way the marriage proposal was conducted -- a two-faced way of signalling that it's the face of the groom that it doesn't like," the French daily said in an editorial.
Commentators said the rise of the Indian-born steel magnate and his hostile takeover bid exemplified the globalisation of companies from emerging countries, which were still taking Western companies and governments by surprise.
"The -- double -- problem is that Lakshmi Mittal is Indian, and that India was more reassuring when it was not a new emerging power, with multinationals on the market," wrote Joel Ruet, a researcher at the London School of Economics.
"This worries old Western capitalism -- Japan included -- which did not want to believe in it. This save our jobs sounds like a save our elites," Ruet wrote in Liberation.
Mittal, the world's third richest person, was born in a Rajasthan village with no electricity and made himself a multibillionaire by leading consolidation of the steel industry.
He lives in London and Mittal Steel -- of which he and his family own 88 per cent -- is quoted in the Netherlands and the United States.
Mittal on Thursday dismissed talk that this was a bid for a European company by an outsider.
"This is a merger of two European companies, not a foreign company," he told a news conference in Madrid.
That was the actual title.
He has spent a good amount on money in Mississippi after the Katrina hurricane. He donated 50 million British pounds to Long Beach, Miss., to rebuild homes after insurers refused to cough up the dough.
Don't see any Chinese citizens helping out like that (note that Mittal still holds an Indian passport)