LUXEMBOURG, April 26, 2002 (PRIMEZONE) -- The Ordinary General Meeting of Arcelor (PinkSheets:ARLOF) shareholders, held on April 26, with Messrs. Joseph Kinsch and Francis Mer in the chair, approved the company's financial statements closed on December 31, 2001(*) and the resolutions that were submitted to it by the Board of Directors. The General Meeting decided to appoint as auditors the societe civile KPMG Audit Luxembourg, both for the financial statements of the public limited company Arcelor and for the consolidated financial statements of the Arcelor Group, for a period ending with the audit of the accounts for the 2004 financial year.
Statements by the Chairmen
In his address Chairman Joseph Kinsch thanked the shareholders for the confidence they had shown in the plan of Aceralia, Arbed and Usinor (PSE:USI) to pool all their industrial, commercial and human strengths in a new company. A large number of shareholders had in fact responded to the Public Exchange Offers launched by Arcelor for the shares of the three founding companies. He noted that at the end of the operation and taking into account the re-opening of the offers for Arbed and Usinor between February 18 and March 8 of this year, Arcelor had received 99.43% of the Arbed shares and 97.58% of Usinor's capital. In Spain 95.03% of the Aceralia shares were submitted to Arcelor.
The subscribed capital totals 2,641,802,555 Euros, represented by 528,360,511 shares.
Kinsch noted that the shareholder structure of the new Group afforded it high visibility and strong liquidity, with more than 70% of the shares having been offered to private and institutional investors ("free float").
Kinsch closed his statement by affirming that it was Arcelor's ambition to be the benchmark of the global steel-making industry.
Chairman Francis Mer highlighted the fact that thanks to the geographic diversity of its production locations, the complementarity of its business lines and the breadth of its product range, Arcelor can offer its customers winning steel solutions, including high-quality services. By combining the innovation policies of the three founding companies and by capitalizing on a range of diversified products with high added value, Arcelor was strengthening its assets to enhance its value in the eyes of its customers and financial markets. He added: "The reason why we established Arcelor is to provide an original, suitable and -- we believe -- pioneering response to the necessary reconfiguration of the global steel industry. With Arcelor we have become a global Group."
Mer pointed out that as a leading player in the global steel industry, Arcelor intends to fully shoulder its responsibilities by promoting a model of sustainable development. The Group is endeavoring to control its environmental risks, to reduce the nuisance concomitant to its operations, to offer environment-friendly steel solutions and to improve occupational safety and health. Human resources management, a civic commitment to serving the community and innovation strategy form part of the same concern for sustainable development.
Commenting on the Group's performance, Mer confirmed the medium-term financial target that the Arcelor Group had set itself: to earn an average return on its capital employed of 15% before tax over the three-year steel cycle and to significantly reduce debt by improving the ratio of debt to shareholders' equity.
CEO, Guy Dolle emphasized that the process of forming Arcelor had taken place in a difficult economic environment. The year 2001 had been marked by a deterioration of the international economic situation, which had been further exacerbated following the events of September 11 in the United States. In such an environment, world steel consumption had increased only slightly over the whole year.
Although uncertainties remain as to the strength of the world's economies' recovery, Dolle foresees, for the current year, an improvement of the steel manufacturing activity. Although the rebound in the US was still moderate, the prospects of global economic growth were better and growth should begin to look more positive in the course of the second half of 2002. This improvement is mainly the result of the necessary rise of selling prices for most products offered by the Arcelor group, as well as of an optimization of the alignment of production vs. demand.
Economic growth in the European Union, which had still been weak at the beginning of the year, might become more sustained in the second half-year thanks to support from household demand, a revival of exports and the economic recovery in North America. This situation should lead to a rebound in apparent steel consumption at the end of the second half-year, with a positive impact on prices.
The protectionist decisions of the U.S. government, intended to protect a U.S. steel industry, which has delayed its restructuring, will affect European steel-makers by causing a certain drop in exports to the United States. The safeguard measures adopted by the European Union following these decisions will allow to avoid an increased flow of third countries steel products to the European Union and will avoid to destabilize a situation on the path to improvement.
Referring more particularly to Arcelor, Dolle concluded that the economic environment, which was still characterized by a great deal of uncertainty, represented both a challenge and an opportunity for the Arcelor Group. A challenge, because the Group had to operate in a difficult environment. An opportunity, because in this situation it had to muster all its strengths in order to make Arcelor's integration a success as soon as possible and to take advantage of complementarity of products and markets in order to set an example for restructuring the steel industry on a global scale.
(*) Arcelor, a societe anonyme under Luxembourg law, was incorporated on June 8, 2001. The company's first financial year ended on December 31, 2001. Arcelor did not have any operational activity at the close of the period under review.
The company will draw up consolidated financial statements, which will be submitted, to the General Meeting of Shareholders on April 25, 2003.