The last time I tried to fathom how Lakshmi Mittal made his billions, I dug into piles of regulatory filings. This time, I breezed through
Cold Steel, a blow-by-blow account of Mittal's hostile takeover of Arcelor SA.
Both episodes raised more questions than answers about the 57-year-old steel magnate whom
The Sunday Times has declared the wealthiest man in Britain for four years running, with a current fortune of £27.7 billion (Dh198bn).
Mittal's five-month battle to acquire Arcelor in a 2006 deal that created the world's biggest steelmaker is now legendary in corporate corridors. Money, power and national pride collided as the two sides, marshalling platoons of investment bankers, lawyers and lobbyists, besieged potential allies, regulators, hedge funds and shrewd investors such as Romain Zaleski.
INSIDER'S ACCOUNT
Authors Tim Bouquet and Byron Ousey frame the story as a thriller full of Gulfstream jets, clandestine meetings and bugged phones.
The plot is punctuated by shouting, code names (Arcelor dubbed Mittal "Mr Moon") and double-dealing, though nothing risque makes its way in. The cast runs from former French President Jacques Chirac to Lloyd Blankfein, chief executive officer of Goldman Sachs Group Inc, who asks Mittal to repeat the target's name.
"How are you spelling that?" Blankfein asks in his best Bronx when Mittal invites Goldman to be lead adviser on the bid.
"A-r-c-e-l-o-r," comes the response.
This is an often breathless insider's account in which the sympathies of the authors come through clearly.
CALIGULA EYES
Arcelor's CEO, Frenchman Guy Dolle, has "pale-blue Caligula eyes", and Arcelor Chairman Joseph Kinsch chain-smokes, quotes Hegel and presides with a "Prussian-like bearing" over a chandeliered boardroom. (Central casting, call Christopher Plummer!)
Mittal, by contrast, is "the mini-mill maestro", the "Andrew Carnegie of his day", the poor Indian kid who yearned to get ahead. "On the reverse side of his ruler he scratched in ink: Dr Niwas Mittal, BCom, MBA, PhD", the authors say.
His Wharton-trained son and Chief Financial Officer, Aditya, comes across as Boy Wonder. Picture him in the parking lot of Michel Roux's three-Michelin-star Waterside Inn on the Thames, shouting into a mobile phone: "The deal is off!"
Perhaps the authors got too close to the winners. In the acknowledgements, they thank ArcelorMittal spokeswoman Nicola Davidson for opening doors. Ousey, a public relations man, advised the Luxembourg government during the bid, which helps explain why the book devotes so much space to political manoeuvres inside the Grand Duchy. ("We say no to Mittal!" Prime Minister Jean-Claude Juncker roars.)
But who are the authors' sources? You have to guess from the context. What about footnotes? Just a handful, though the authors do provide a handy list of the main players, in case you forget which sides investment-banking brothers Yoel and Michael Zaoui worked for.
The treatment makes for a clever case study and good copy, in a Jeffrey Archer way. The authors manage to build suspense even though the reader knows from the outset that Arcelor capitulated to Mittal. In the end, the 13 banks that advised both sides on the deal collected $200 million (Dh734m) in fees.
KID GLOVES
What the book fails to do is seriously address concerns raised over the years about how Mittal built his empire. Yes, the authors mention past questions about corporate governance, tax breaks, donations to the UK Labour Party and soft loans from the European Bank for Reconstruction and Development.
Yet they raise these issues mostly to dismiss them, emphasising instead the concessions Mittal made to get the Arcelor deal done: he lowered the family's share capital, eliminated its special voting rights, proposed making two-thirds of the board independent, and agreed the Mittals would vote their shares in accordance with the directors' recommendations.
So why do I remain uncomfortable with a serial acquirer who once controlled his empire through a company registered in the Netherlands Antilles and even, the authors say, called Kazakhstan leader Nursultan Nazarbayev a visionary?
After finishing this hagiography, I called the publisher, Little, Brown, where publicist Jenny Fry assured me that neither the Mittals nor ArcelorMittal had paid the authors.
I guess they didn't need to.
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