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ThyssenKrupp launches legal action to secure Dofasco acquisition

ThyssenKrupp launches legal action to secure Dofasco acquisition

German industrial conglomerate ThyssenKrupp AG said Tuesday that it has launched legal action aimed at securing the acquisition of Canadian steelmaker Dofasco Inc.
ThyssenKrupp lost a bidding war with Arcelor SA over Dofasco, but during Mittal Steel Co.'s successful battle to acquire Arcelor, Mittal pledged to sell Dofasco to ThyssenKrupp.
In November, however, Arcelor Mittal said an independent Dutch-based trust now controlling Dofasco had refused to allow its sale. That prompted ThyssenKrupp to warn it would "exhaust every possibility" to see Mittal abide by the deal to sell it Dofasco.
A ThyssenKrupp statement Tuesday said the company "has now initiated legal action." It added that "the aim of the action against Mittal Steel is to secure the release of Dofasco from the foundation and allow the sale to ThyssenKrupp." It did not give further details.
A statement from Mittal Steel Co. NV said a suit was filed against it in the district court in the Dutch city of Rotterdam.
The Dofasco situation is a legacy of Arcelor's bitter battle against Mittal's takeover bid earlier this year.
Determined to protect its new acquisition from being sold off if Mittal prevailed, Arcelor management locked it into the independent trust based in the Netherlands, which would need to agree any resale.
According to Mittal, ThyssenKrupp alleges that Mittal breached their agreement by failing to have Arcelor launch litigation that would have forced the trust to return its Dofasco shares to Arcelor _ thus making possible the sale. It wants the court to order such action now.
Mittal said a court hearing was scheduled for Jan. 11. Its general counsel, Simon Evans, said that "ThyssenKrupp's suit is entirely without merit" and that Mittal had taken all reasonable action to fulfill its agreement with the company.
Mittal added that neither it nor Arcelor had taken a final decision on possible litigation against the trust, but said it had been advised prospects were "remote" that it would succeed.
Mittal hoped to soothe U.S. antitrust concerns by selling the Canadian steelmaker.


Updated : 2021-03-08 11:24 GMT+08:00