Mittals see Turkey and Asia as possible next destinations

Mittals see Turkey and Asia as possible next destinations

On the back of the $4.5 billion merger of LNM Steel with Ispat International and ISG Steel, Chief Executive of LNM Group and the proposed Mittal Steel Co. Lakshmi Mittal announced in a statement that his company is interested in acquiring Turkey's largest steelmaking plant Eregli Demir Celik (Erdemir) whose privatization of 46% of the state-owned firm he expects to take place in early 2005. To support this statement, Mittal states that the Erdemir plant is a very logical investment for Mittal Steel Co. as it is only 200 kilometers away from the company's existing plant in Romania. The Erdemir plant is projected to produce roughly 4.5 million metric tons of steel per year by 2005, up from the current 3.4 million tons, with the potential of producing about 7 million metric tons per year by 2007. While Mittal's first priority for investment is currently Turkey, the company also has its eye on possible acquisitions in Asia in the future, including Mittal's native India in which the company still has no steel operations. In Asia, besides India, Mittal also announced that the company would like to make further investments in China but as he does not want to be a passive investor, he is waiting for state-run companies in China to allow foreigners to invest with them. In relation to LNM Steel's merger and acquisition with Ispat International and ISG Steel, investment securities firms in Turkey have performed analytical studies of Erdemir's financial fundamentals and reinforce their ’buy' recommendation for Erdemir at a target price of TL 7'800 per share.