Arcelor takes measures to fend off Mittal bid

Arcelor, the world's second biggest steelmaker, today announced measures, including an extraordinary dividend, designed to fend off the $25.1 billion bid from rival Mittal Steel. According to a statement released by Arcelor today, firstly, the Board of Directors of Arcelor resolved to propose at the next General Shareholders' Meeting a dividend higher than announced on February 16, 2006. The distributed amount would accordingly be increased from Euro 1.20 to Euro 1.85 per share. Secondly, the Arcelor Board of Directors unanimously resolved to prevent sale of Dofasco since it would be against the interests of Arcelor. Accordingly, effective 3 April 2006, the Arcelor group transferred its shares in Dofasco to an independent Dutch foundation named "Strategic Steel Stichting" (S3). The foundation would have independent control over any decision to sell Dofasco. Thirdly, the Arcelor Board of Directors announced its intention to distribute a total amount of Euro 5 billion to the shareholders coming from group's available cash-flow. Such payment, which does not include the dividend payment of Euro 1.85, and which terms shall be decided later by the Board of Directors, could take the form of a share buyback, company sources report.