Worldnews.com= Hedge funds in steel giant Arcelor asked a Dutch court on Wednesday to block the company’s 30 billion ($40 billion) takeover by Mittal Steel, saying that a revised share swap deal has cost them $205 million.
“We are only getting 3.3% of a valuable company and we should be getting 4.4%,” Philip Price, COO of SRM Global, said. The steel firms already call themselves ArcelorMittal, but three funds SRM Global Master Fund, Trafalgar Catalyst Fund and Trafalgar Entropy Fund want to block the first phase of the merger, when Mittal is to combine with ArcelorMittal, a holding company.
Under a takeover offer made in August 2006, investors were offered 11 ArcelorMittal shares for seven Arcelor shares. But the bid was revised in May to offer eight ArcelorMittal shares for seven Arcelor shares.
Mittal plans to seek shareholder approval for the deal on August 28 and complete it on September 3. In the second phase, at a later date, ArcelorMittal would merge with Arcelor. The Rotterdam court will issue its written decision on Monday on whether to block the merger, a day before shareholder meeting.
