Just business: Mittal

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By AMIT ROY in London
  • Published 4.06.05

London, June 4: There may be an Ambani vs Ambani saga and even Bachchan vs Bachchan but there is, as yet, no Mittal vs Mittal, it was stated in London today.

Press reports, including one in the Financial Times in London, have stated that Lakshmi Mittal, who owns the world’s largest steel-making company, is “embroiled in a legal wrangle” with a firm run by his younger brother, Pramod.

“There is no falling out between them,” said a spokeswoman for the Mittal Steel Company. Pramod is said to run Global Infrastructure Holdings Ltd.

“Sometimes we come up against them ? business is business ? but there is nothing personal,” said Lakshmi Mittal’s spokeswoman.

According to the Financial Times, the two companies have encountered a serious conflict of interest in Liberia.

“Mittal Steel says it approached Liberia’s government last year to develop via a joint venture ? the Liberian Mining Corporation (Liminco) concession, which encompasses iron ore deposits, a railway and the port of Buchanan,” reports the Financial Times.

“But a court case filed against the government by rival steel company Global Infrastructure Holdings Ltd (GIHL), run by Lakshmi’s younger brother Pramod Mittal, has pushed back talks over possible investment in the multi-million-dollar project.”

The paper adds: “GIHL and its partner Provider Ltd claim they have the rights to the project after signing a memorandum of understanding with Liminco in November 2003. Both Mittal Steel and GIHL are keen to develop the project in the face of rising global prices for iron ore.

“Mittal Steel needs raw materials for its mills in Algeria and South Africa. GIHL needs more resources to feed the giant Ajaokuta steel mill and the Delta Steel Company in Nigeria.”

GIHL and Provider say a letter signed by Jonathan Mason, Liberia’s mines minister, on August 30, 2004, states that a motion to engage GIHL in contract negotiations was agreed by Liminco's board after considering proposals from other companies, including Mittal Steel. They also say that the decision by Gyude Bryant, Liberia’s interim President, to halt any further negotiation in October 2004 ? so the project could be more widely advertised ? was a violation of Liberian law.

Jacob Varnam, a Provider director, said Mittal Steel’s discussions were spurred on by John Blaney, US ambassador to Liberia.

In a letter to Blaney in September 2004, Inland Ispat, a US-based Mittal Steel company, said that sourcing cheap iron ore from Liberia for its US operations would “safeguard in excess of 30,000 jobs in the Chicago area through direct and indirect employment”, according to the Financial Times.

In London, the Mittal patriarch, Mohan Lal Mittal, tends to live in Mayfair with his son, Pramod, while Lakshmi is due to shift to his new house, said to be the world’s most expensive private residence, in Kensington Palace Gardens.

Many years ago, Mohan Lal had differences with his brother and conceded ownership of small steel mills his father had set up after moving to India from Pakistan at the time of partition. In time, Mohan Lal set up Ispat in Calcutta and eventually sent Lakshmi to Indonesia to begin Ispat International, which has now been subsumed into the newly created behemoth, Mittal Steel Company.

Lakshmi and Pramod have been seen once together at a charity auction in London, otherwise few can remember the brothers turning up at Asian functions together as is the style with the much more closely knit Hinduja brothers.

Pramod is hardly known in the Asian community compared with his affable and personally charming elder brother. A well-informed business source in London said of the alleged differences between Lakshmi and Pramod: “This is nothing new. The father (Mohan Lal) is trying to cement relations between the two.”