ArcelorMittal Eyes Better Value From Share Issue Than Asset Sales
February 05 2016 - 4:08AM
Dow Jones News
By Alex MacDonald
LONDON--Shareholders of steel giant ArcelorMittal (MT) will
derive better value from a rights issue than if the company sold
assets as the supply and demand dynamics in the global steel market
begin to improve, said the company's Chief Financial Officer Aditya
Mittal.
"We have to make sure we don't destroy value" through asset
sales, Mr. Mittal told reporters. "The best value decision [is] a
rights issue," he said.
ArcelorMittal on Friday announced plans to raise $3 billion
through an equity issue plus another $1 billion from the sale of
its 35% stake in Spain's automotive steel component firm Gestamp.
This should reduce net debt to less than $12 billion compared with
its previous medium-term net debt target of $15 billion and net
debt of $15.7 billion at the end of December.
Mr. Mittal said "the most difficult period of the steel prices
and costs were reached towards the end of 2015." He expects steel
prices to rise, buoyed by trade action in the U.S. Europe and
elsewhere against a surge in steel imports from China. Global steel
demand should remain broadly flat compared with its 2.2%
contraction last year, the company said.
-Write to Alex MacDonald at alex.macdonald@wsj.com
(END) Dow Jones Newswires
February 05, 2016 03:53 ET (08:53 GMT)
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