MERGER OF ARCELOR STEELAND MITTAL STEEL

Steel Industry – An Overiew

Steel is the world’s third largest commodity

World production1.244 bn metric tons in 2005-06

Average growth rate per annum in 2005-06 was 9% and that over 2000 to 2005 being 6.1%

World production1.3 bn metric tons in 2007-08

Type Public

Industry Steel

Successor(s) ArcelorMittal

Founded1976 in Calcutta, India, 1989 as Ispat International in Sumatra, Indonesia

Headquarters Rotterdam, Netherlands

Key people Lakshmi Mittal, Founder, Chairman and CEO

ProductsSteel, Flat Steel products, Coated Steel, Tubes and Pipes

Revenue $28.132 billion USD Year to 31 Dec 2005

Operating income $4.746 billion (2005)

Net income $3.365 billion (2005)

Employees 320,000 (2006)

Website Mittal Steel

Mittal Steel Company was formed by the merger of

• LNM holdings & ISPAT International

• International Steel Group Inc.

CEO Lakshmi Mittal’s family owned 88% of the company and its headquarter was in Rotterdam, Netherlands

The company was the world’s largest steel producer by volume and also the largest in turnover and is now a part of ArcelorMittal

It was the major player in Steel, Flat Steel products, Coated Steel, Tubes and Pipes

Mittal Steel Growth Timeline

1989: Acquisition of Iron & Steel Company of Trinidad & Tobago

1992: Acquisition of Sibalsa 1994: Acquisition of Sidbec-Dosco1995: Acquisition of Hamburger Stahlwerke > Ispat International Ltd. and Ispat Shipping

formed > Acquisition of Karmet 1997: Ispat International NV goes public 1998: Acquisition of Inland Steel Company 1999: Acquisition of Unimétal 2001: Acquisition of ALFASID > Acquisition of

Sidex

2002: Business assistance agreement signed with Iscor 2003: Acquisition of Nova Hut 2004: Acquisition of Polski Huty Stali > Acquisition of BH Steel > Acquisition of Macedonian facilities from Balkan Steel > Creation of Mittal Steel and proposed acquisition of International Steel 2005: Acquisition of a stake in Hunan Valin > ISG Acquisition completed > Mittal Steel Europe created > Mittal Steel makes Fortune 500 list of top companies> MDA with Liberian government > Acquisition of Kryvorizhstal > MoU with State of Jharkhand, India > Acquisition of Stelco subsidiaries > Stake lifted in Mittal Steel Zenica

Type Société Anonyme

Industry Steel

Fate merged with Mittal Steel

Predecessor(s)

Arbed (1911)Aceralia (1902)Usinor (1948)

Successor(s) ArcelorMittal (2006)

Founded 18 February 2002

Headquarters Luxembourg City, Luxembourg

Products Steel

Revenue € 32.611 billion (2005)

Employees 94,000[when?]

Website www.arcelor.com

•Arcelor S.A. was the world's largest steel producer in terms of turnover and the second largest in terms of steel output, with a turnover of €30.2 billion and shipments of 45 million metric tons of steel in 2004.

• Employing 4,10,000 employees in over 60 countries, it is a major player in all its main markets: automotive, construction, metal processing, primary transformation, household appliances, and packaging, as well as general industry.

• With total sales of over €30 billion, Arcelor was the world's largest steel manufacturer in terms of turnover. •It produces long steel products, flat steel products and inox-steel.

Financial Position in 2005COMPANY MITTAL

ARCELOR2005 Sales $28.10

$38.84

1-Year Sales Growth 27% 8%

2005 Net Income $3.37 $4.58

1-Year Net Income Growth -28% 66%

Employees 175,000 96,000

Type Public

Founded 2006

HeadquartersAvenue de la Liberté, Luxembourg, Luxembourg

Area served Worldwide

Key peopleLakshmi Mittal (Chairman of the board and CEO)Aditya Mittal (CFO)

Industry Steel

ProductsSteel, flat steel products, long steel products, stainless steel, wire solutions, plates

Revenue US $124.9 billion (2008)

Operating income ▲ US $12.24 billion (2008)

Profit ▲ US $9.399 billion (2008)

Total assets US $133.1 billion (2008)

Total equity US $59.23 billion (2008)

Employees 315,900 (2008)

ARCELOR MITTAL

Arcelor Mittal is now the largest steel company in the world

ArcelorMittal is the leader in major global markets, including automotive, construction, household appliances & packaging

The company is headquartered in southern Luxembourg City, the former seat of Arcelor

Lakshmi Mittal (owner of Mittal Steel), a non-resident Indian is the Chairman and CEO

Headquarters at Luxembourg city

It employs 4,10,000 employees in more than 60 countries

ArcelorMittal key financials for 2007 show revenues of US$ 105.2 billion

A crude steel production of 116 million tones, representing around 10% of world steel output

As of May 17 2008, the market capitalization of ArcelorMittal was $144.37 billion

THE DEAL

INITIAL BIDJanuary 14: Mittal talked to Arcelor CEO

about the deal.January 27: Mittal steel launches a bid of $

22 billion. January 29: Arcelor rejected the offer.

HOSTILITY AND RACISMhostility by Arcelor’s Management Board racial discrimination

The CEO of Arcelor dismissed Mittal Steel as a “company of Indians”

Increasing Offers and PressureApril 19: Chief Executive Lakshmi Mittal

calls Arcelor Chairman Joseph Kinsch to ask for "friendly discussions''

April 28 : "significant corporate governance changes'' and revise the offer.

May 4: Kinsch says the offer is "wholly inadequate''

May 9: Mittal Steel is ready to revise the offer and make corporate governance changes"

May 18: Mittal formally launches its offer.

SEVERSTAL – A NEW PLAYERMay 26: Arcelor announces a deal with

Severstal June 2: European Union antitrust regulators

approve Mittal bid on condition.June 6: The European Commission approved

the Mittal-Arcelor merger June 12: Arcelor rejects Mittal revised bid and

recommends shareholders accept deal with Severstal.

June 20: In a bid to woo Arcelor, Severstal revised the terms of its merger proposal

AGREEMENT TO MERGER AND FINAL MERGERJune 19: Arcelor cancels shareholder meeting

on share buyback June 21: Market regulators want more clarity

on the state of talks with Mittal and Severstal June 25: Arcelor's board agrees to sweetened

bid from Mittal worth about $32.3 billion.June 30: 57.95% per cent of Arcelor

shareholders voted against the Severstal offer. They accepted Mittal Steel's $32.3 billion offer

AGREEMENT TO MERGER AND FINAL MERGERJune 19: Arcelor cancels shareholder meeting

on share buyback June 21: Market regulators want more clarity

on the state of talks with Mittal and Severstal June 25: Arcelor's board agrees to sweetened

bid from Mittal worth about $32.3 billion.June 30: 57.95% per cent of Arcelor

shareholders voted against the Severstal offer. They accepted Mittal Steel's $32.3 billion offer

Terms Laid Down By Arcelor

New company to be called Arcelor-Mittal, and not Mittal-Arcelor

Majority of board members will be from Arcelor despite Mittal’s high stake

The company will be headquartered in Luxembourg

LN Mittal will be co-chairman along with Arcelor chairman Joseph Kinsch

Merger Process

2 step process First step-Mittal Steel was merged into a ad hoc

subsidiary named ArcelorMittal Second step-ArcelorMittal was merged into

Arcelor, which was renamed ArcelorMittal

Corporate Structure: Arcelor

Calculation of the Indirect

Valuation of Arcelor Brasil

1. Determination of Arcelor Brasil’s Proportionate EBITDA contribution to Arcelor’s EBITDA

2. Determination of Arcelor Brasil enterprise value implied by Mittal Steel offer for Arcelor

3. Calculation of Arcelor Brasil MTO Reference Value per Share

Post Merger

Arcelor + Mittal = ArcelorMittal

Building our Company with the needs of future generations in mind

Market Position By Region

Operations in more than 20 Countries.Annual production capacity of 130 million tonnesProduced over 116 million tonnes of steel.Steel shipments totaled approx. 110 million tonnesGenerated revenues of US$ 105.2 billion.Announced 35 more acquisitions.Organic growth of 20 million tonnes.Unique R&D capability in the steel industry

PostMerger

Overview

Industry leader

Geographically diversified

EBITDA split by geography

Cost leadership

No 1 in automotive steel

As Per Today's Standing in NYSE Market

14.44   0.54(3.60%) Sep 28 – Market Price on Closing of Day

Market Cap: 22.37BP/E (ttm): 121.34EPS (ttm): 0.12Div & Yield: 0.64 (4.20%)Market Price fluctuation From 2008 up till

today's date

ConclusionLargest global player

Smoothen out the price fluctuations

Created a much stronger and more sustainable business

Clear strategy to deliver further growth and value creation

how the “impossible” Arcelor-Mittal merger became possible.

Thank You