PARIS, Mar 24 (Reuters) After weeks of political lobbying and closed-door meetings with big-time investors, steel producer Arcelor staged a glitzy rally for ordinary shareholders on Thursday and urged them to block hostile bidder Mittal Steel.
Chief Executive Guy Dolle urged an audience of 1,000 mainly elderly people who own shares in the world's second biggest steel firm to help him fight off a $24 billion bid from steel magnate Lakshmi Mittal and said he was confident of success.
''I hope that you too will reject this bid,'' Dolle said amid loud cheers in a hall under the Grand Arch at La Defense -- a striking glass, steel and marble monument inaugurated in 1989 to celebrate the bicentenary of the French Revolution.
Arcelor, a multinational steel firm based in Luxembourg but which traces its roots in part to privatised French steel mills, invoked French symbols like the Little Prince children's book character and the Stade de France stadium.
The struggle between Arcelor -- which includes a real-life Luxembourg prince on its board -- and Indian-born Mittal's fast-growing steel empire has come to symbolise a clash between old and new wealth as Europe tries to adapt to globalisation.
But Dolle said he was not afraid of being linked to the past. ''The past pleads in our favour -- we have always reached our objectives,'' he said.
Arcelor has been fighting against Mittal's bid with the support of Luxembourg, its chief shareholder, as well as France and Spain, where it has steel plants and thousands of workers.
Mittal Steel's proposed share-and-cash bid values Arcelor at 19.9 billion euros ($24 billion) or 31.07 euros per share, while Arcelor stock closed on Thursday at 31.60 euros.
''I prefer a share quoted in Paris over Indian paper. If the bid succeeds, I will immediately sell the Mittal shares; and if everybody does we risk losing a lot of money,'' said an investor.
Mittal's Indian roots have captured significant media and political attention in France, though his company is based in the Netherlands, its shares are quoted there and in New York, and the billionaire himself is a longtime resident of Britain.
France has promised to be fair in assessing the bid.
A representative of an Arcelor defense group said regulators should study Mittal's books because it ''goes from pro forma results to pro forma results and nobody knows the real profit.'' Arcelor's Finance Director Gonzalo Urquijo said the group had not decided whether to take advantage of a new French law allowing takeover targets to issue share warrants implying dilution at some future stage, weakening an aggressor.
BRIEFING BELGIUM Dolle said earlier he had met 80 per cent of Arcelor's institutional investors -- who account for about 70 per cent of Arcelor's capital -- and is ''more and more confident'' that they will reject Mittal's overtures.
He repeated that Mittal's bid was a purely financial offer lacking a business plan.
Mittal says his bid to combine the world's top two steel firms is the best way to create a European champion large enough to face up to Chinese competition and would fit the needs of increasingly global present clients, while cutting costs.
Dolle also pledged to answer a Belgian government request for more details on Arcelor's plans there by March 31.
Arcelor has said it may close a blast furnace near Liege after 2009 and is also reviewing the role of the stainless steel activities in the group, which includes the Charleroi site.
Both these sites are in Belgium, where Arcelor employed 15,400 people at the end of 2005.
Dolle said Arcelor was not considering closing the stainless steel activities, which he called the best performing in Europe, but was conducting a strategic review.
He declined detailed comment on a Russian newspaper report that steel magnate Vladimir Lisin of NLMK NLMK.RTS wanted to buy a 15 per cent stake in Arcelor.
Dolle said that he knew Lisin, and that his company was the best in Russia, but would not say whether there had been contacts.
($1=.8289 Euro) REUTERS SD PC1617