Media and Financial Community Comments

The Economist - ‘Cast-iron’- 17th June 2006
The victims in all this are Arcelor’s shareholders – something that should worry investors in Europe. All along, Messrs Kirsch [Kinsch] and Dollé have denied their own shareholders a proper shout.

The way to decide between the two is for Arcelor’s shareholders to have a fair vote. It is their company, after all.

That is the principle at stake here – and a good reason to hope that Arcelor investors now rush to sell their shares in the market to Mr Mittal, giving him the majority he needs.

The Economist - ‘Arcelor wobbles’- 17th June 2006
The only effective way for Arcelor shareholders to protest the proposed merger with Severstal is to sell their shares to Mittal by July 5^th, when its tender offer expires.

“I think Mittal will succeed,” says Richard Brakenhoff, an analyst at Rabobank in Amsterdam, who thinks that Mr Mittal’s bid is much the more attractive. Increasingly, those Arcelor investors who will speak in public about the proposed deals, seem to agree.

Le Quotidien – 16 June 2006
"Of course I will vote against. The company is going to distribute cash to the shareholders which will have the effect of passing control of Arcelor to Severstal," declared ADAM President Colette Neuville, who represents 2.5% of the Arcelor equity. "There is a high probability that the share buyback will be rejected."

La Tribune - 16 June 2006
“This [Arcelor buyback program] is all backwards. With this operation, the shareholders pool their resources, by emptying the Arcelor coffers, and thus give Mordashov control,” she said. The investors she represents, who account for 2.5% of Arcelor stock holders, asked her to vote against the operation.

“Arcelor would do better to spend this money wisely, instead of doing everything it can to please its shareholders,” added Gerard Augustin-Normand. [head of Richelieu Finance]

Financial Times - ‘Arcelor shareholder to vote against buy-back’ - 15th June 2006
“US-based shareholders in Arcelor voiced fears that the document [spelling out Mordashov’s control over the new company] severely limited the ability of Lakshmi Mittal’s Mittal Steel to formulate a new offer for Arcelor and have this dealt with fairly by the Luxembourg company’s board.”

“A manager at one of the investors told the FT: ‘The wording of this document indicated that Mr. Mordashov will effectively be taking control of the new company.’ Another shareholder said he thought the document ‘placed big impediments’ that could block a new offer by Mittal being adequately considered by Arcelor.”

Les Echos - 15th June 2006
"Arcelor is buying back its shares for 44 euros whereas it did not do so at 21 euros, the share price up until the takeover bid. This is entirely irresponsible and bordering on mismanagement", exclaims Pierre-Henri Leroy, consultant with institutional investors Proxinvest. "Equity is being squandered and shareholders are getting nothing in return -- because the money is theirs".

"Arcelor's behaviour is becoming irrational", deems one investor. " Arcelor is doomed if it doesn't get approval for the share buyback. Since that's on the cards, the whole matter could be wound up this week-end with an agreement between Mittal and Arcelor".

Exane BNP Paribas, 15th June 2006
“The business plan release by [Mittal] management helped highlight the significant earnings potential that exists at Mittal Steel and should give investors and Arcelor shareholders some confidence that they would be receiving deep value shares as part of the Mittal Steel tender for Arcelor shares.”

“Based on our calculations, there would be ample room on the balance sheet of the combined [Mittal/Arcelor] group for such an additional cash return, which would benefit both the current Arcelor and Mittal Steel shareholders.”

Carlo Tassara, International, Arcelor’s second largest shareholder - Financial Times, 14th June 2006
“The share buy-back is a transfer of cash from Arcelor to its shareholders, without any value creation.” The buy-back would “destroy shareholder value.”

Colette Neuville, President of ADAM - The Guardian, 13th June 2006
“We don’t know anything about this [Severstal] operation and there’s no element of a genuine evaluation. Last week I wrote to the Arcelor board demanding it give us the information so we can make a choice. So far we are being asked to decide about two things and we only know about one [Mittal].”

Pierre-Henri Leroy, Proxinvest - The Guardian, 13th June 2006
"It's a kind of trap"

The French shareholder groups Proxinvest and Adam said the deal with Alexei Mordashov, Severstal's majority owner, was opaque, and Arcelor's proposal that it could be halted only by a majority vote against was unacceptable and offered no genuine choice.

Pierre-Henri Leroy, Proxinvest - Börsen-Zeitung, 10th June 2006
“We reject the share buyback also because it is nothing but an obvious defence measure against Mittal.”

Jean-Pierre Hellebuych, director for strategy at Axa Investment Management - La Tribune, 6th June 2006
"The Dutch trust for Dofasco deserved a first yellow card and the partnership with Severstal another. In other words a red card! "

Pierre-Henri Leroy, Proxinvest - Express on Sunday, 4th June 2006
“Its extremely disappointing. Arcelor’s strategy has been self-destructive and the board has not done its job.”

Institutional Shareholder Services, 1st June 2006
In light of the concerns surrounding the timing of the proposed authority, not to mention the timing of the EGM itself, in addition to our reservations as to the company's capacity to execute such a share buy-back without jeopardizing future financial stability of the company, it is recommended that shareholders oppose these items at this time.

Colette Neuville, President of ADAM - Financial Times, 31st May 2006
“Arcelor’s duty of loyalty to its shareholders and the rules of good governance… require

that the sale of control of the company should lead to public offer, in line with European norms.”

Jutta Rosenbaum, Commerzbank, 26th May 2006
"We continue to recommend to accept Mittal’s offer and remain a shareholder of the combined entity. Arcelor shareholders will have no benefit at all from the supposed value of €44 per share that is said to be implied in this [Severstal] deal."