What Techniques Did Mittal Utilize In Order To Dominate The Steel Market?
What techniques did Mittal utilize in order to dominate the world steel market? ArcelorMittal is currently the world's leader and largest producer of steel. The company was founded in 2006 by Lakshi Mittal, the current Chairman and CEO. Currently there are around 220,000 employees and profits of $7.94 billion. The company was formed through a takeover of Arcelor by Mittal. Mittal utilized a hostile takeover that was replacing a planned merger of Arcelor and Severstal. Therefore the company was formed in the name, ArcelorMittal. The major key factor for the company's success was through various acquisitions. Other steel companies fell off in this area and therefore couldn't become as well-known as ArcelorMittal. Throughout the essay, there
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The buyout was opposed by majority of the people but through the $40 billion investment and battling, he succeeded. Steel became a symbol to express the country was industrialized. Mittal is therefore looked very highly upon in the global steel industry. Mittal grew up in a small town of 50,000 people in harsh conditions with barely any basic resources such as water. 1989, he became a manager of a steel manufacturer in Trinidad and realized he could spread out in other countries by starting out in Kazakhstan. This became a huge exporting center to China. Spreading out in former communist states to rapidly expand the business. This is an extremely risky move by Mittal but he realized and saw the chances of expansion and acted upon his instincts. 1st step towards success in the mills? Downsizing. Mittal reduced the amount of workers to a little over 10,000, and also simplified the facility. Downsizing is often utilized when the company observes a declining revenue, poor economic conditions or for any other strategic reasons. Downsizing reduces the amount of workers therefore reducing overhead costs. The investment in the latest technology allowed the few workers to be able to monitor …show more content…
ISG was sold to Mittal in order to work together to expand the business, and agreed on a global strategy by thinking of the world as one market. They aim to buyout Arcelor, the 2nd largest manufacturer in the world with steel mills located everywhere around the world. Much more synergies fit with Mittal better than any other company. Guy Dolle, CEO of Arcelor, turned down Mittal's bid and this is when the hostile takeover was announced. Some believed that downsizing will result in rise of unemployment. A buyout team was formed to persuade shareholders because they play a huge role. In this case, Arcelor had only 20% of long-term shareholders but how will they get 80% on Mittal's side? Mittal claimed that the merger will help corporate and shareholder values to rise. As any hostile takeover, there are arguments and both firms will have their own say. As a desperate act, Dolle tries to merge with Severstal, a Russian steel producing company, but fails as Russian firms were not trusted due to their ties with Putin also because Sevestral was only 1/4 of Mittal’s company. Mittal also persuaded the shareholders, releasing articles that they don't have their own voice as he started gaining more people on his side and as shareholder prices rise Selling shares to Mittal helped them to gain major profit. Finally the battle was one and the buyout was
The buyout was opposed by majority of the people but through the $40 billion investment and battling, he succeeded. Steel became a symbol to express the country was industrialized. Mittal is therefore looked very highly upon in the global steel industry. Mittal grew up in a small town of 50,000 people in harsh conditions with barely any basic resources such as water. 1989, he became a manager of a steel manufacturer in Trinidad and realized he could spread out in other countries by starting out in Kazakhstan. This became a huge exporting center to China. Spreading out in former communist states to rapidly expand the business. This is an extremely risky move by Mittal but he realized and saw the chances of expansion and acted upon his instincts. 1st step towards success in the mills? Downsizing. Mittal reduced the amount of workers to a little over 10,000, and also simplified the facility. Downsizing is often utilized when the company observes a declining revenue, poor economic conditions or for any other strategic reasons. Downsizing reduces the amount of workers therefore reducing overhead costs. The investment in the latest technology allowed the few workers to be able to monitor …show more content…
ISG was sold to Mittal in order to work together to expand the business, and agreed on a global strategy by thinking of the world as one market. They aim to buyout Arcelor, the 2nd largest manufacturer in the world with steel mills located everywhere around the world. Much more synergies fit with Mittal better than any other company. Guy Dolle, CEO of Arcelor, turned down Mittal's bid and this is when the hostile takeover was announced. Some believed that downsizing will result in rise of unemployment. A buyout team was formed to persuade shareholders because they play a huge role. In this case, Arcelor had only 20% of long-term shareholders but how will they get 80% on Mittal's side? Mittal claimed that the merger will help corporate and shareholder values to rise. As any hostile takeover, there are arguments and both firms will have their own say. As a desperate act, Dolle tries to merge with Severstal, a Russian steel producing company, but fails as Russian firms were not trusted due to their ties with Putin also because Sevestral was only 1/4 of Mittal’s company. Mittal also persuaded the shareholders, releasing articles that they don't have their own voice as he started gaining more people on his side and as shareholder prices rise Selling shares to Mittal helped them to gain major profit. Finally the battle was one and the buyout was