Heat on at Arcelor with Mittal's renewed bid

London, May 20: Lakshmi Niwas Mittal has got more support from the Arcelor shareholders than he expected, after he raised Mittal Steel's bid for the European steel giant to 17.5 billion euros.

Most analysts feel Arcelor management has been put in a difficult position as its further refusal to consider the Mittal offer would be viewed by investors and shareholders as bad form and judged harshly by them.

Shareholders have reportedly called on the Arcelor board to sit down and negotiate with Mittal Steel. Analysts called the offer attractive and appealing, and predicted its likely success.

Institutional investors said that Arcelor's management would be negating their fiduciary duty to shareholders if they continued to resist negotiating with the Mittal company.

Gary Clarke, a fund manager, was reported commenting, ''The game has significantly moved on. It's serious and credible.'' The heat is on Arcelor, he added.

Yesterday, rounds of applause broke out during the Mittal Steel presentation, which a business commentator said was not in conformity with the form of city presentations, that are given in ''grumpy silence and followed by rude questions.'' But the cheering was expected with the room full of Mittal fans.

The commentator, however, agreed that the new bid ''looks full'' and knocked Mittal stock only by two per cent, suggesting that market will find it persuasive.

Equally important will be the family's conversion to the one share, one vote principle. This is a major concession because it will take the Mittals below the 50 per cent mark, although their substantial stake will still give them an effective control.

UNI