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Hamilton Gallery
Tuesday November 29, 2005
ThyssenKrupp of Germany yesterday trumped Arcelor, the world's second-largest steelmaker, by making an agreed 3.5bn (2.4bn) offer to acquire Dofasco, Canada's biggest steel group, in a new wave of consolidation in the industry.

Luxembourg-based Arcelor, which made a hostile 3.2bn bid for Dofasco last week, indicated it could spark a bidding war with a better offer. Dofasco's shares jumped higher than the German bid.

Ekkehard Schulz, ThyssenKrupp chief executive, whose "white knight" bid was 10% higher than Arcelor's and a 40% premium to Dofasco's closing price on November 22, also pointed to the prospect of a bigger offer, saying the C$61.50 (30.68) he had tabled was "a start". He said: "We are in the driving seat and know we were very welcome to the Dofasco board, which called us to see if we would enter a support agreement and unanimously approved our offer.

"If anyone wants to outbid us, they will have to explain why to their shareholders and that won't be easy ... A higher offer can't be excluded but we are very confident," said Mr Schulz.

The Thyssen counter-offer, made and approved at the weekend, gives it control of large iron-ore reserves near Dofasco's HQ at Hamilton, Ontario, which it plans to use in part to expand in eastern Europe. It also has access to big reserves in Brazil.

ThyssenKrupp rides in to save Dofasco with agreed 3.5bn bid
The Guardian
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