Published: May 30 2006 03:00 | Last updated: May 30 2006 03:00
There are many reasons to express doubts about the move by Arcelor, the Luxembourg-based steel group, to buy Severstal of Russia in order to sidestep the hostile bid by Mittal Steel. One is the way the Arcelor board is presenting the takeover as a done deal, which only an absolute majority of all shareholders will be able to reject. A second is the opportunity for yet another oligarch’s fortune to leave Russia, with Alexei Mordashov picking up nearly one-third of Arcelor in return for his90 per cent of Severstal.
But the reason to welcome this deal, which will have been cleared in advance with the Kremlin, is that Vladimir Putin, the president, is evidently showing none of the neurosis about one of his country’s top two steelmakers coming under foreign control that he displays about foreign ownership in Russia’s energy sector. If only his evidently relaxed view on Severstal could become the template for a more general Russian openness to foreign investment. But only last week, at his summit with the European Union, Mr Putin was touchily describing the energy sector as “the holy of holies of our economy” and demanding reciprocity for any EU investment in it. read more
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