Arcelor keen on Dofasco takeover
Luxembourg-based Arcelor S.A. announced Wednesday, November 23, that it would be making an all cash take-over bid for all of the outstanding common shares of Canadian steelmaker Dofasco Inc. at C$56.00 ($47.74) per share.
The offer will represent a premium of approximately 27.3% over the closing price of C$44.00 per common share on November 22, 2005. Furthermore, the price represents a premium of nearly 46.4% over the closing price of C$38.25 per share on November 10, 2005, the last
trading day prior to take over speculation.
Arcelor had approached Dofasco on several occasions, starting in the first half of 2005 with a view to exploring the possibility of an acquisition. While Dofasco's management and Board of Directors engaged in some dialogue in connection with the most recent proposal, the parties were unable to reach terms that were acceptable. Therefore, Arcelor decided to make this offer directly to Dofasco's shareholders.
Guy Dolle, Chief Executive Officer of Arcelor, said the proposed transaction would be Arcelor's largest investment in
North America to date, reflecting Arcelor's strong confidence in
Canada and in Dofasco, its management team and its world-class employees. Mr. Dolle also recognized Arcelor's long-standing relationship with Dofasco, particularly through their DoSol Galva Limited Partnership joint-venture based in Hamilton, Ontario.
Mr. Dolle emphasized that intense international consolidation in the global steel industry makes the combination of Dofasco with another player inevitable.
"Canadian steel producers, regardless of their current competitiveness, are not immune to the forces driving consolidation around the globe. For Dofasco, the question is not if it should join forces with another industry player, but when, and with whom. We strongly believe that Arcelor is the best partner for Dofasco and that this is the right time."