LONDON – LAWFUEL – Press Release Service – Allen & Overy LLP is advi…

LONDON – LAWFUEL – Press Release Service – Allen & Overy LLP is advising Severstal, the largest Russian steel company, on its merger with Arcelor SA, the world’s number one steel company. The merger of the two companies will create the world’s most profitable steel company.

The transaction values Arcelor at €44 per share (excluding €1.85 dividend), representing a 36.6% premium over Arcelor’s closing price ex-dividend on May 25, 2006. In addition, up to €7.6 billion in cash will be returned to shareholders, including via dividends and OPRA (self tender).

The merger of Arcelor and Severstal will result in the combined group having €46 billion in sales, €9 billion in EBITDA and 70 million tonnes of production, based on each company’s pro forma 2005 results.

The Allen & Overy LLP team is being led by London based senior corporate partner Alistair Asher assisted by senior associates Ed Barnett and Dominic Morris and junior associate Anthony McKenzie and corporate partner Pierre Schleimer in Luxembourg. Moscow Partner Edwin Tham and associates Lisa O’Neill, Igor Mazilin, Arthur Abdullov and Boris Zakharov are providing Russian support. Antitrust advice is being provided by partner Michel Struys in Brussels, partner Michael Jahnke in New York and senior associate Brian Sher in London. Luxembourg-based partner Jean Schaffner is advising on tax issues and New York-based partner Ken Rivlin is advising on certain US regulatory aspects. The instruction from Severstal came through the Moscow office.

Alistair Asher commented “It has been a privilege to advise on this transformational transaction for Severstal which will create the world’s largest steel company. The combined group will be the most profitable in the global steel industry. The transaction demonstrates the importance of the leading Russian companies in the global market and underlines the strength of our Russian practice.”

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