Mittal-ISG deal nearing

Recycling Today, March, 2005

The U.S. Justice Department has approved the proposed merger of International Steel Group Inc. (ISG), Richfield, Ohio, into Netherlands-based Mittal Steel Co. N.V.

ISG was formed just a few years ago, building on the assets of the bankrupt LTV Steel Co. It acquired Bethelehem Steel and other assets on its way to rapidly becoming one of the largest steelmakers in the United States.

But ISG's history will apparently be a brief one, as Mittal Steel Co. is reporting that it expects to complete its acquisition of ISG by the end of the first quarter of 2005.

The merger of ISG into Mittal operations would result in Mittal Steel Co. having mills and other plants in several states in the United States, plus Eastern Europe, Mexico, South Africa, Kazakhstan, Trinidad and Tobago and elsewhere.

The post-merger Mittal Steel will become the largest steel company in the world, with the capacity to produce about 70 million tons of raw steel per year.

The 2004 surge in steel prices helped the company enjoy net income of $4.7 billion last year on sales of $22.2 billion. The revenue figure was 132 percent greater than 2003's figure, while the 2004 income figure was nearly four times the $1.2 billion earned in 2003.

Mittal has also announced an arrangement to acquire about one-third of China's Hunan Valin Steel Tube & Wire Co., giving it a stake in the world's largest steel producing nation.