Ispat International to acquire LNM Holdings and merge with ISG

Ispat International to acquire LNM Holdings and merge with ISG

According to the statement released by Netherlands-based steel producer Ispat International N.V, the company will acquire LNM Holdings N.V. After the takeover is completed, the new name of the company will be Mittal Steel Company N.V. Moreover, Ispat International N.V and Ohio-based International Steel Group (ISG) have recently signed an agreement under the scope of which the two companies will merge. When the merger and the acquisition are finalized, Mittal Steel Company will be the largest and among the most profitable steel companies in the world. Mittal Steel will have operations in 14 countries on four continents. The company had pro forma revenues of $22.5 billion, pro forma operating income of $4.9 billion and pro forma total shipments of 43 million tons for the nine-month period ended on September 30, 2004. For 2004, Mittal Steel will have pro forma revenues of over $31.5 billion, pro forma operating income of $6.8-7 billion, pro forma steel shipments of 57 million tons and pro forma debt of $3.2 billion. The merger is stated to be an important step forward in the globalization of the industry. Moreover, the new company will be among the most profitable steel companies in the world. The company will have stable sources for raw materials, such as coal, coke and iron ore and it will produce wide range of steel products, which will broaden its customer base. On the side of the acquisition of LNM Holdings by Ispat International, the completion of the acquisition is subject to the approval of shareholders of Ispat International. On the side of the merger between Ispat and ISG, the completion of the merger is also subject to the approval of the shareholders of ISG and Ispat. The transaction between Ispat and LNM is expected to be completed by the end of 2004 and the transaction between Ispat and ISG is expected to be completed by the end of first quarter of 2005. Once the acquisition of LNM Holdings is completed, Ispat International shareholders will own 18.3% of the combined company and LNM shareholders will own 81.7%. Once the transaction between Ispat and ISG is completed, ISG shareholders will own between 6.9%-8.6% depending on the average price of Mittal Steel shares for the 20 trading days prior to the merger.