Capital market-relevant press releases, 2007-01-23, 01:50 PM
Following decision by Rotterdam court: Acquisition of Dofasco by ThyssenKrupp now a remote prospect/ThyssenKrupp to concentrate on greenfield solution in the USA
On December 22, 2006, ThyssenKrupp AG filed legal action against Mittal Steel NV in Rotterdam to obtain judicial clarification of the sale of the Canadian steel company Dofasco to ThyssenKrupp, as bindingly agreed by Mittal Steel. Clarification became necessary after Mittal Steel and ThyssenKrupp failed to agree on a joint procedure vis-à-vis the Dutch foundation which holds the Dofasco shares.
Dofasco is currently owned by a Dutch foundation to which Arcelor transferred the Dofasco shares as part of its defense against Mittal Steel’s takeover bid. On November 10, 2006, the directors of the foundation decided not to transfer the Dofasco shares back to Arcelor even after the ending of the takeover situation. In doing so, the foundation ignored corresponding requests from the Boards of Arcelor and Mittal Steel. In the interests of its shareholders, ThyssenKrupp was obliged to exhaust all possibilities of acquiring Dofasco, especially as several leading independent legal experts in the Netherlands stated in corresponding legal opinions that the foundation is obligated to transfer its shares in Dofasco back to Arcelor.
Following the hearing on January 11, the court today announced its decision that the release of Dofasco from the Dutch foundation cannot be enforced by summary proceedings before the expiration of the agreement between ThyssenKrupp an Mittal Steel on April 27, 2007. This means that ThyssenKrupp’s chances of acquiring Dofasco are now very remote.
ThyssenKrupp will therefore swiftly pursue its plans to build a new steel mill in the USA. The aim of this greenfield project is to significantly strengthen the position of ThyssenKrupp Steel and ThyssenKrupp Stainless in the North America region. The NAFTA market is one of the biggest volume markets for high-grade flat carbon steel. Above-average growth is forecast in the coming years for stainless steel flat products. Central to the greenfield project is the construction of a hot strip mill which will be used primarily to process slabs from ThyssenKrupp’s new CSA steel mill in Brazil.