The dynamics of the Mittal Arcelor merger

Extract

[...] As a result of the union of the two largest producers, the group Arcelor Mittal has become a giant in the steel sector. The challenge will be to build on this position and become the supplier of steel worldwide. The challenge for the company will be to project a new corporate image without affecting its core values. The company will have to move from a specialized image to that of an entity that manufactures a broader range of products. Beyond the diversity of the range, Arcelor Mittal had to resume the vision of diversity as a key factor for performance in an economy and a sector that is heavily globalized. [...]

[...] Arcelor has clearly suffered enough of a failed management at the highest level; the rescue attempt by a merger with Severstal emerged as a total failure. That decision was taken unilaterally, without consultation with stakeholders including shareholders, who were yet in the center of the battle here. Perhaps one of the biggest pitfalls of Arcelor was the confusion created in the minds of the public, and the shareholders. The merger with Severstal was a seen in good light in the public's view but it was not satisfactory. [...]

[...] The 2002 merger between three European groups had been particularly well managed, with the construction of a new group identity, focusing on European cooperation, developing synergies, and specialization in a particular segment. At the time of the takeover bid, Arcelor was therefore a strong company, with a long term vision. But besides being strong, Arcelor also enjoyed the climate prevailing around these events. Indeed, a rare thing in respect of a stock transaction (ultimately only within the financial sphere), the company could rely on the mobilization of the media, state and public opinion to gain economic patriotism. [...]