Chapter 1 Introduction
With the globalization, companies around the world are forced to change their strategic to establish to be in the global market. To survive in this ever increasingly competitive environment, companies seek out alternative growth strategies. The most common way of growth was the organic way of growth i.e. by way of internal expansion. But, over the last century, Mergers and Acquisitions have overshadowed this traditional growth. Compared to other industries worldwide, steel industry has developed mostly on individual basis with comparatively less pressure toward globalization. However, in order to increase competitiveness and keep up with the globalization of raw materials companies, small movements for reorganization have occurred among steel companies. These relatively gradual changes faced an unprecedented turning point in 2006 after Mittal, which claimed the global number 1 spot through M&As, successfully acquired Arcelor, which was ranked second. The case of Arcelor and Mittal steel merge brought much more transparency into the steel subject and helped to analyze the present scenario of mergers in the steel industry. The two companies have travelled a parallel path over the years.
In 2005, Mittal Steel was created by combining the American steel company, ISG. Mittal steel is based in London which headquater in Neatherland with 45 % sale in Europe compare with 78% of Arcelor. Mittal Steel is the largest steel producer in the North Americas, Africa, and Eastern Europe, and it has a growing presence in Asia. Specifically, Mittal Steel produces flat products, including sheet and plate, long products, including bars, rods and structural shapes, and stainless steel products.
Arcelor was created in 2002 through merger of three major European steel companies, Arbed (Luxembourg), Aceralia (Spain) and Usinor (France). Arcelor is strong in Western Europe and Brazil and focuses mainly on flat products but was also a significant long product producer.
Objectives of the study
The aim of this study is to elaborate a lesson for operating business environment regarding the concept of Globalization and is to assess the performance of mergers and acquisitions and their impact on the acquirers of the firm. Various factors like culture difference, market share, and size of acquirer are considered to explain the varied results of the returns to the acquirers.
In addition to this, a case study of the merger between Mittal Steel and Arcelor was undertaken to study the scenario of mergers and its impact on the company's performance. This study will also look at the advantages that the merger offers in terms of profitability, increased customer base. Additionally, it helped to analyse the present scenario of mergers in the steel industry and to assess the performance of mergers and acquisitions.
In order to study whether value has been created through mergers and acquisitions, we have made use of a research strategy known as Case Study Analysis. The basis for choosing these two mergers is to analyse a successful merger. To distinguish about the particular merger we have used press reports and analysts' reports. The case study has applied both studies approach and the accounting studies method to achieve its aims. The accounting studies approach is adopted for the purpose of studying the various aspects of value creation by the merger. This study measured the profitability, of the firms before and probability revenues after the merger of the companies. The main focus of such accounting studies ranges across various financial ratios such as the operating income, earning per share (EPS) and current ratio.
Chapter 2 Analysis and Findings
In order to study whether value has been created through mergers and acquisitions, we have made use of a research strategy known as Case Study Analysis. The basis for choosing these two mergers is to analyse a successful merger.
Case Study Analysis - Mittal Steel & Arcelor Steel
The two companies Mittal and Arcelor have travelled a parallel path over the years. Both the companies aimed at creating a more stable operating environment and perceived that the economies of scale, combined with geographic and product diversification, was a vital ingredient in the steel industry success. This shared vision resulted in a merger between Mittal and Arcelor. The paths of Arcelor and Mittal steel merged on the 25th June, 2006.The merger deal was worth €26.9 billon which declared ArcelorMittal to be the largest steel manufacturers in the world. The main objective behind the merger between Arcelor and Mittal was to create a strategy in order to become the world's lowest margin and highest steelmakers, thereby achieving sustained profitability, reduced risk and substantial growth opportunities. At the time of the merger, Mittal ranked number 1 globally in terms of production, with 63 million tons of production compared to Arcelor's 44.7 million tons, while Arcelor was generally regarded as number 1 in terms of technology and product quality. Since, Arcelor itself had been formed by a merger of the top steel companies of France, Spain and Luxembourg, the governments of the respective countries were strongly opposed to Arcelor's takeover by Mittal. No one in global steel industry predicted or prepared for such a large scale merger of two giants in the industry. Additionally, it was also believed that as a result of this merger, the company would be able to achieve maximum synergies in marketing, trading and purchasing and reduce the risk.
The merger deal
One of the biggest merger deals in the steel industry was announced on July 2006, which brought together top two leaders Mittal steel and Arcelor Steel. The merger meant that Mittal Arcelor would have the largest R&D budget in the steel industry. MittaL Steel had to increase its initial bids of €18.6 billion by 45% to €26.9 billion in cash and stock to acquire Arcelor Steel. The deal offered a 11% premium to Arcelor shareholders ans per share the new bid valued Arcelor at €38. The motive behind this merger was that it would bring two powerhouses together and the synergies were to be exploited. Mittal Arcelor was expected to claim about the 10% of global output and the production about 3 times greater than the nearest rivals. The merger meant that Mittal Arcelor would have the largest R&D budget and make a strong powerful force in the steel industry.The merger was expected to generate cost synergies of approximately $1 billion annually and was projected to be the number one global player in steel industry. The deal allows Mittal to spread North American value to Europe, access to Latin America nad more diversified. Additionally, Arcelor could entry into stronger network including No 1 in US.
Mr. Lakshmi Niwas Mittal, an indian born businessman founded Mittal Steel in 1976. Initially his company was best on the use of scrap substitute materials. His success has largely been built on buying up loss-making state-owned mills and quickly turning them around. He had one of his most notable successes in the late 1989, when he turned around a loss-making government-funded steel firm in Trinidad and Tobago. Similarly, he entered in US market by acquisition of Inland steel in 1998, an important automotive supplier and flat product maker. In 2005, Mittal Steel was created by combining the American steel company, ISG. Mittal steel is based in London which headquater in Neatherland with 45 % sale in Europe compare with 78% of Arcelor.
Mittal Steel is the largest steel producer in the Americas, Africa, and Europe, and it has a growing presence in Asia. Mittal Steel has steel-making operations in 26 countries on four continents, including 64 integrated, mini-mill and integrated mini-mill steel-making facilities. As of December31, 2006, Mittal Steel had approximately 320,000 employees. Mittal Steel produces a broad range of high-quality finished and semi-finished carbon steel products. Specifically, Mittal Steel produces flat products, including sheet and plate, long products, including bars, rods and structural shapes, and stainless steel products.
Arcelor was created in 2002 through merger of three major European steel companies, Arbed (Luxembourg), Aceralia (Spain) and Usinor (France). It was headquartered in Luxembourg and Mr. Guy Dollé was the CEO. At the time of its acquisition by Mittal Steel in 2006, Arcelor was the second largest steel producer in the world in terms of production, with 2005 production of 46.7 million tonnes of steel and 2005 revenues of €32.6 billion. It operated in all key end markets: the automotive industry, construction, household appliances, packaging and general industry. Arcelor enjoyed leading positions in Western Europe and South America, in particular due to its Brazilian operations. 
The group deals in four core businesses, positioning them at the top of the ladder in terms of the production of the stainless steel. They are one of the world's largest 72 producers of flat carbon steel including slabs, heavy plate, metallic and organic coated steel which are mainly used in the automotive and industrial sector.
Motive of the Merge & Acquisition
There have been various reasons for the companies to engage in mergers and acquisitions. Some of those motives have been outlined and discussed in detail below:
One of the most common motives for mergers and acquisitions is growth. According to Gaughan (1999), there are two broad ways in which the companies can grow. One is through internal growth which is quite slow and ineffective, if a firm intends to take advantage of a window of opportunity where there is short-term advantage over competitors. It is this limitation that the companies adopted a faster alternative by means of mergers and acquisitions. The basic idea for undertaking Mittal Arcelor merge was to achieve growth by broadening their product lines and increasing their market share. The Mittal steel paid the substantial amounts of premium to acquire the resources which provide them with accelerated growth.
Another main motive for undertaking mergers and acquisitions is diversification where the acquiring companies have an advantage to lower their risks and exposures to volatile industry segments by including various other sectors to their corporate umbrella. Diversification might prove to be successful for Mittal and Arcelor Steel, but it seems to require much more skills and infrastructure than some companies actually possess.
Increasing Market Share
The driving force behind Mittal Arcelor merger could also be the attainment of greater market power. The market power implies that the company possesses certain advantages over its competitors where it can achieve much greater profits in a particular period of time. This increased market power was not just restricted within the vicinity of sales but also in the area of purchases. Thereby undertaking such a merger activity, the company can attain a huge market share and also raise the prices of their products and services, comparative to their costs. Further this tends to add value to shareholder.
Creation of Synergy
One of the main motives for Mittal Arcelor merge is the desire to achieve synergy between the two companies and to derive their associated benefits. Synergy refers to the "ability of two or more units or companies to generate greater value working together than they could working apart". 
A simple formula for this synergy between the two companies A and B has been illustrated by Gaughan (1999) in his paper where:
Value (A+B)>Value (A) + Value (B) 
It was also believed that as a result of this merger, the company would be able to achieve maximum synergies in marketing, trading and purchasing.
Another source of synergy involved in this acquisition is technological synergy, is the integration of the technologies and research & development (R&D) processes. Such synergies are created by the firms which indulge in activities such as sharing of research and development programs, transfer of technologies across various programs and products and the expansion of new core business by employing private innovative capabilities. 
The first offer that Mittal unveiled on January 27, 2006, an unsolicited $22.7 billion bid for Luxembourg-based Arcelor. As it is already mentioned, both companies had been acquiring others in the global industry involving them in a tough competition against each other. Rather than thinking of going both hand in hand against all others, they had been taking part of various bidding fights for acquisitions of companies.
In one such typical bidding, the steel company, Kryvorizhstal of Ukraine was on the block. Many companies entered the fray and the price kept on increasing. Mittal Steel and Arcelor were the last two remaining in the tussle, and the price increased from $3.5bn (when the last company left leaving these two) to $4.8bn where Mittal Steel won the bid.
Generally, in such acquisitions, the acquirer company would like to have a co-operative discussion and settlement. After acquiring, the acquirer is dependent on the target firm for collaboration - from executives, employees etc.
When the acquiring process started one key issue is how to start discussion with the target group. Gregariousness, agreeableness and cognitive ability of the negotiators play a major role in the negotiation. So, a person on the other side with these attributes should be preferred and Mr. Mitthal found Mr. Alain Davezac, Senior Vice-President, International Business Development, Arcelor. He had been dealing with the extended Mittal family befor and was an outgoing person. He was enchanted with Buddhism and had dealt with Indians & Indian Companies extensively before in his career. After discussion with Mr. Alain for some time, Mittal tried to involve Mr. Dolle CEO of Arcelor. But this topic stoped there as Mr Dolle had to follow-up on their proposed acquisition of the Canadian company, Dofasco. This gave the whole story a new turning point. Mittal was well aware with the situation, if Arcelor went ahead with the Dofasco deal, his plan of merging might become a daydream due to anti-trust conditions and due to Arcelor becoming a larger company. So Mittal need to find out alternative way to deal with Dofasco. They signed a binding agreement with ThyssenKruppAG* about selling Dofasco to them, after the merger. Without wasting any more time, on 27th January 2006, offer was announced.
The offer was rejected at the same time without any surprise. The supporter from Arcelor viewed this offer as very aggressive and not at all beneficial to them. The management were on the opposite site of this offer, they thought that there is lack of strategic fit between two companies and the offering price is too low. For them, this takeover mean loss of the power they enjoying while managing the company independently. Arcelor employees were also scared of job cuts that might happen after such large merger. Additionally, the employee assumed that this was more of a hostile takeover and in the merged body; they would have a lower status as compared to Mittal Steel employees. The merger issue not only scared the management and employees but also the different governments with stakes in Arcelor, they were afraid of workers from their countries losing jobs as they were not consulted before the bid. As next step, both sides took a stock of which stakeholders can be on their sides and started talking to them. As the employees, management and different governments were opposed to this deal, Arcelor tried to utilize this prospect by convincing them to oppose any deal from the Mittal.Whereas there was no one on Mittal side initially. At that time investors were the only ones who they can currently manage to get on their . They started contacting them but were not as successful as they would have liked. Arcelor management continued doing their bit to remove any possibility of the bid going through. They kept their aggressive pursuit for Dofasco, declared a huge dividend, laid out its medium-term aggressive acquisition strategy and promised healthy growth of the company. It subsequently acquired Dofasco and locked it into an independent Dutch trust making it impossible for Mittal Steel to part with it . Believing that investors shareholders would be willing to agree if the deal is sweetened in terms of the price, Mittal decided to branch out with select specific stakeholders with which an alliance can be built.
* ThyssenKruppAG was also involved previously in bidding for Dofasco that was also involved previously in bidding for Dofasco
Now the major concern is with governments of different countries and European Union. If the governments can be explained the proposal and their concerns incorporated, a major fight would be won. Mittal had to agree ranging from guaranteeing the pension, healthcare benefits to restraining any kind of job losses. They even had to agree to make Luxembourg as the headquarters of the merged body. Then slowly governments agreed to these modified agreement and the European Commission gave a gesture to the deal. As soon as it became clear to Mittal that government would support the deal, Mittal formally launched the hostile takeover and raised bid price. During this process, some other story was going on other side. Arcelor was convincing Severstal, a Russian steel company, to bid for it at higher price than Mittal steel. On the other hand, Mittal started publicizing that the merged body would be fully controlled by Severstal's Russian CEO, Mr. Aleksei Mordashov, and the merged body would lead a Russian company rather than remaining a European company. Mittal raised the case in public forum and newspaper that helped directing Arcelor stakeholders and asked them to sanction Severstal deal. Finally, the Arcelor board had to approve the Mittal offer, which was followed by the shareholder approval.
Types of merger
The study shows the horizontal merger between Mittal Steel and Arcelor Steel as two companies operate and compete in similar kind of way and are situated in the same juncture of the business cycle. The rationale behind such mergers is the willingness to achieve synergy between the two business units. As the Mittal Steel & Arcelor Steel holds top two market position respectively, such large horizontal mergers are often perceived as anticompetitive. The merger expected that this combination would create a vast enterprise controlling nearly 10% of the world steel market leaving the nearest rivals by three times lesser in productions. This large horizontal merger has now given the new company an unfair market advantage over its competitors. Additionally, it would lead to more bargaining power with suppliers & customers as Toyota Motor, Ford Motor.
Type of Acquisitions
Mittal Steel adopted the hostile acquisition when the Archelor Steel management and the borad of directors opposes the initial bids of the Mittal. But when Mittal offer the price of €26.9 bn on june 2006, the Arcelor shareholders vote to accept the offer even if management resists and claims that the company is actually worth even more.
The merge of Mittal & Arcelor resulted in the creation of the world's largest steel company with the production capacity of approximately 138 million tons i.e 10% global outputs. Steel making in 60 countries sells its products to a diverse range of automotive, appliance, engineering and construction.
Face the uncertainty and risk of such as paying too much investment on the takeover, restructuring management & culture difference.
Mittal Arcelor would become the first company to produce more than 100 million tons. Achieve greater geographic reach & have access to more raw materials.
Monopolizing the steel industry when two top rivals merge and occupying the 10% of total global outputs, would lead to more bargaining power with suppliers & customers as Toyota Motor, Ford Motor. Further it induces complexity, duplication of people, processes and technology. Besides, cultural differences may create failure if not managed properly.
When measuring the financial performance of the merged firm, one of the main indicators of growth can be estimated from the sales figures. Whilst analyzing the sales figures of Arcelor from the year 2003, it is revealed that the sales increased from €25,923 million to €32611 million by the end of 2005.On the other hand, the sales figure of Mittal steel illustrate that the company has been showing consistent growth prospects before the merger. The year 2004 proved to be a remarkable year for the company when it generated revenue of US$22.2 billion due to the increase in the demand for steel and enhanced size benefits. This figure increased to US$28.13 billion in the year 2005.
After the merger, the consolidated results of Arcelor Mittal showed a stupendous growth in the sales at US$58.9 billion. The company was able to maintain its growth in operating profits soon after the merger. Its operating profit stood at US$7.8 billion in the year 2006 as compared to US$4.7 billion in the previous year.
The gross margin and operating profit margin percentages too demonstrate the overall quality and performance of the business. The operating profit for Arcelor was 735 million euros, €3194mn and €4417mn in 2003, 2004 and 2005 respectively. The operating profit showed a consistent trend over these years before the merger. However, Mittal Steel exhibited an inconsistent trend in the operating profit by increasing from $1,299mn in 2003 to $5514mn in 2004 but then stooping to $4729mn in 2005.After the merger, the new firm's operating profits increased to US $7499mn in the year 2006 as compared to the income generated in 2005 at US $4729mn.
Evaluation of the financial ratios is another very useful tool to analyze and interpret the financial statements. The earning per share (EPS) is calculated by dividing the net profits after taxes and preference dividend by the total number of equity shares. This ratio indicates how much the company's earnings have grown per share basis. Arcelor's EPS was €0.54mn,€4.26mn and €6.26mn in the years 2003, 2004 and 2005. The earnings for Mittal Steel were around $1.83mn in 2003. The earnings reached to the highest level at $8.10mn in the year 2004 and then drastically fell to $4.79mn in 2005.After the merger; Arcelor Mittal experienced a rise in their earnings per share of $5.76 millions in 2006 as compared to $4.80mn in the year 2005.
Comparison of Arcelor Mittal's Performance with Industry Competitors
However to gauge the true picture of the merged companies, a comparison is done with its competitors in the same field .Mittal's performance if considered in isolation might be isleading so a comparison of the company's performance with its main competitors Pasco and United states steel corporation. In this comparative analysis the acquiring company, Mittal steel has been taken for comparison to measure the impact of the merger on the acquirers.
Posco steel, a well-known Korean steel company was established on April 1, 1968. It has secured the highest competitive level in the global steel technologies since 2006. It manufactures a wide portfolio of products amongst which they are the leading manufacturers of automotive steel. In addition to this, the company deals in high carbon steel; strip casting and tire cord wire rod .This company has been supporting the use of various environment-friendly materials with the development of graphite and tin free cutting steel components. In the year 2005, they recorded a spectacular 4.36 million tonnes of total sales, making it world-class automotive steelmakers in the world. The company holds a massive export market, with Japan being on the top, followed by China, Thailand, Indonesia and Asia.
The U.S Steel Corporation was founded in 1901, launched with an authorized capitalized value of $1.4 billion. Headquartered in Pittsburg in the United States, it manufactures a wide variety of steel sheet; coke and taconite pellets; tabular and tin products; and possesses a worldwide annual raw steel capability of 26.8 million tonnes. It is the sixth largest producer of steel in the world and second largest integrated steel producer in North America. The company has significant operations all around the central Europe as US steel Kosice, established in Slovakia, and US steel Balkan, located in Serbia.
In the next section, a trend analysis is undertaken for all the ratios and other performance indicators. The different indicators that add value to the firm are studied in comparison to the competitors to understand whether ArcelorMittal's performance is good enough. The ratios are explained with the help of graphs to depict the trend in a better way and to get a more accurate view of the company.
When looking at the revenues generated by Arcelor Mittal , one could come to the conclusion that the revenues have increased from $9567m in 2003 to $ 28,132m in 2005.However, in the year after the merger, that is in 2006, Arcelor Mittal showed a stupendous increase of $58,870m .In the case of Posco, the growth in revenue has been consistent. It steadily grew from $14,925 to $27,787m in 4 years maintaining consistent growth prospects. The total revenues of United States Steel corporation have also been slightly increasing with 9328m to $15,715m in 2006.This can been clearly observed from the graph below:
Earnings Per Share (EPS)
The growth in earning per share for Mittal Steel has been quite inconsistent as compared to Posco which exhibited a positive growth of $12.61m but failed to keep the momentum upward in the year 2006.Though the earning per share enhanced in 2004 for Mittal Steel because of the acquisition of various companies. United States Steel Corporation initially showed a negative figure of $-4.27m in the earning per share but increased to a whopping amount of $11.18m in 2006.
When comparing the operating income figures of Mittal steel and its competitors, it can be observed that the operating income of both Mittal steel and Posco has been increasing on average till 2005. On the contrary, for the United States Steel Corporation there has been an initial loss of $719m, but from 2004 to 2006 the operating income though fluctuating, was successful in achieving an overall positive figure of $1,785m.This is illustrated in the graph below:
Thus, the operating income for Mittal Steel has almost increased seven times as compared to Posco whose performance almost doubled in these 4 years.
The challenges ahead Mittal Arcelor Steel
Mittal Steel has experienced rapid growth and development through acquisitions in a relatively short period of time and may continue to pursue acquisitions in order to meet its strategic objectives. Such growth entails significant investment and increased operating costs. Overall growth in Mittal Steel's business also requires greater allocation of management resources the continued development of Mittal Steel's financial and management information control systems, the ability to integrate newly acquired assets with existing operations, the ability to attract and retain sufficient numbers of qualified management and the ability to manage the risks and liabilities associated with the acquired businesses. Failure to manage such growth, while at the same time maintaining adequate focus on its existing assets, could have a material adverse effect on ArcelorMittal's business, financial condition, results of operations or prospects.
Arcelor Mittal could face significant price and other forms of competition from other steel producers, which could have a material adverse effect on its business, financial condition, and results of operations or prospects and thereby reduce Arcelor Mittal's cash flow and profitability. So need to focus on product development to compete with the rivals in the market segment. The only important criterion that the management needs to keep in mind is that they need to sustain this growth over a period of time. They need to allocate their resources optimally to various activities and the need to bring out marketable products.
In additions, Arcelor Mittal will be subject to political, social and legal uncertainties in some of the developing countries in which it will operate. Any disruption or volatility in the political or social environment in those countries could have a material adverse effect on ArcelorMittal's business, financial condition, results of operations or prospects.
Chapter 3 Conclusions
Many recent mergers and acquisitions have indicated that the companies undertake such activities in order to widen their horizon by expanding their market share and developing international presence. Today it has also been recognized that it is extremely important to remain competitive and maintain equilibrium with the market trends. Mergers and Acquisitions is one of the most vastly researched topics in the field of finance these days. The major issues of the current study were to assess the performance of the mergers and their impacts on the return to the acquirers of the firm.
In order to elaborate scenarios a case study of Mittal Steel and Arcelor was undertaken. A detailed study of different parameters was taken to evaluate the financial performance of the two companies. Though the merger occurred within eight months of the closing, but integration would continue for some time to achieve cultural integration. Cultural differences within the two firms are significant. In effect, neither company was homogeneous from a cultural perspective. This diversity gives ArcelorMittal management an advantage, since it provides an opportunity to learn new ideas.
Some of the major key financial components taken were the operating income, total revenue and Earning per share (EPS) etc. The main reason for the Mittal Steel to takeover Arcelor was to gain the benefits from synergy, to increase the market share by diversification and to enhance the economic and financial position of the company. Further, the case of Arcelor and Mittal steel merge brought much more transparency into the steel subject and helped to analyse the present scenario of mergers in the steel industry.
In summary, the acquisition provides Mittal with several strategic advantages delivering a Leadership position in high-end segments in North America, with strong Research and Development capabilities. Operations in high-growth economies of Asia and South America with low-cost profitable assets and local operations expertise in numerous emerging markets and access to raw materials and upstream integration. Additionally, this merger also proves that macroeconomic, political and social paradigms are no longer constants confined to back any corporate decision-making calculus with the blurring of national boundaries. A good lesson this report try to deliver is for all industries is that the shareholder always wins. Recommendations
There were various limitations confronted at different levels during the study. Firstly, it was time constraint that appeared as a limitation to the research. Besides this, the approach adopted for analyzing the impact of the merger between Arcelor and Mittal steel was quite imprecise. For the purpose of comparing its performance with the industry competitors not many years could be considered. For years analysts have been complaining of the lack of a fair top to bottom consolidation within the industry. They became the giant company but still have to maintain the synergy in each level at every step. Since, it has not been quite long that the merger has taken place; the results might not hold much significance in the long run.Any misbalance in their supply and management may benefit the whole industry. It will also offshoot on the other big companies to look for suitable partners. The world has four main regions when it comes to steel production. The big companies are Corus, TKS, and Riva in Europe; Nucor and US Steel in North America; and Gerdau in both North and South America. These companies will certainly be looking for partners in the coming months and years to compete with the prospective new giant undoubtedly in terms of geographical and product coverage. So in future, the "big" group (ArcelorMittal) has to be terribly "focussed" in order to be able to compete with the potential new giant certainly in terms of geographical and product coverage, and certainly in terms of the raw materials benefits.
As ArcelorMittal continues its integration, the company will have to disclose more fully details of its environmental performance. The first ArcelorMittal Corporate Responsibility Report (2007) makes a decent start with limited global statistics, but the absolute size and nature of the company's operations demand much more segmented, regional and specific data on energy, material and water use. Beside these management and strategic issue ArcelorMittal is facing challenges in climate change. With steelmaking worldwide contributing more than 3% of global man-made carbon dioxide emissions (World Resources Institute), ArcelorMittal will certainly come under pressure to contribute to reduce this emission. So it's better to increase efficiencies and search out innovative production processes in order to cut emissions.