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Last Updated: Thursday, 16 February 2006, 17:31 GMT
Arcelor payout to woo investors
Worker at Arcelor steel plant in eastern France
Arcelor is facing the heat of a hostile takeover bid
Steel firm Arcelor, which is trying to see off a hostile takeover bid from rival Mittal, is to boost its annual shareholder dividend by 85%.

Thursday's announcement came as Arcelor unveiled a 66% increase in annual net profits, up to 3.8bn euros ($4.5bn; 2.6bn) for 2005.

Arcelor said it would outline details of future strategy later this month.

On Wednesday, Mittal, the world's largest steel firm, reported that its annual net profits had dropped by 29%.

Mittal unveiled its 18.6bn euros bid for Arcelor at the end of last month.

It is not an exceptional dividend
Guy Dolle, Arcelor chief executive

Arcelor chief executive Guy Dolle insisted on Thursday morning that the 85% increase in its annual dividend was not an attempt to boost shareholder opposition to the Mittal bid.

"It is not an exceptional dividend, it is a normal dividend," he said.

Future strategy

Arcelor directors will lay out their future plans for the company in the next few weeks, hoping to show investors that Mittal Steel's bid undervalues the firm's growth potential.

Mittal chief Lakshmi Mittal said on Wednesday that he was pleased with the "positive" response he had received from Arcelor's shareholders to the takeover bid.

The board of Luxembourg-based Arcelor has vowed to fight off Mittal's bid, saying the two companies did not "share the same strategic vision, business model and values".

Luxembourg's government has also voiced its opposition, as has the French government, which is concerned about potential job losses among Arcelor's French workforce following any takeover.





SEE ALSO:
Rising costs hit Mittal profits
15 Feb 06 |  Business
Belgium open-minded on Mittal bid
06 Feb 06 |  Business
Mittal 'sad' about political row
01 Feb 06 |  Business
Arcelor rejects Mittal Steel bid
29 Jan 06 |  Business
Britain's heavy metal billionaire
27 Jan 06 |  Business
Mittal Steel unveils Arcelor bid
27 Jan 06 |  Business


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