Mittal, Lakshmi

▪ 2006

      London-based steel tycoon Lakshmi Mittal ranked third on Forbes magazine's 2005 list of the richest people in the world. His vault from number 62 on the 2004 list was powered by the merger of his companies, Ispat International and LNM Holdings, and the acquisition of Ohio-based International Steel Group. The newly created company, Mittal Steel Co. NV, emerged from the deal as the world's largest steelmaker, with its headquarters in Rotterdam, Neth., and some 175,000 employees at facilities in 14 countries. Mittal was regarded as a determined businessman with an unusually keen sense of the world steel market. He attributed his successful global approach to his being raised in India, where more than 300 ethnic groups found ways to work together as a nation.

      Lakshmi Narayan Mittal was born on June 15, 1950, in Sadulpur, Rajasthan, India. In the 1960s his family moved to Calcutta (now Kolkata), where his father operated a steel mill. Mittal worked at the mill while studying science at St. Xavier's College. After graduating (1970), he served as a trainee at his father's mill, and in 1976 he opened his own steel mill in Indonesia, where he spent more than a decade learning how to run a mill as efficiently as possible. In 1989 Mittal purchased the beleaguered state-owned steel works in Trinidad and Tobago, which had been losing more than $100,000 a day. A year later that facility had doubled its output and had become profitable. He used a similar formula for success in a series of acquisitions all around the world, purchasing failing (mostly state-run) outfits and sending in special management teams to reorganize the businesses.

      Mittal's business philosophy emphasized consolidation in an industry that had become weak and fragmented. Although demand for steel remained high, smaller steel companies had been unable to strike competitive deals with their major clients, notably automakers and appliance manufacturers. Mittal Steel, however, controlled about 40% of the American market for the flat-rolled steel used to make cars, which would allow the giant steelmaker to negotiate more favourable prices.

      Mittal, who was sometimes described as being media shy, nonetheless made news frequently in the U.K., often because of the way he spent portions of his reported net worth of $25 billion. Among his more notable expenditures were a record £70 million ($128 million) for a 12-bedroom home in London; an estimated $60 million for his daughter's 2004 wedding in Paris, a six-day extravaganza that included an engagement party at the Palace of Versailles; and a donation of £125,000 (about $180,000) to the Labour Party in 2001 that created trouble for Prime Minister Tony Blair when it was learned that later that year Blair had helped Mittal purchase a steel company in Romania even though Mittal's firms backed a U.S. tariff opposed by British steel producers. In 2005 Mittal reportedly donated £2 million (about $3.6 million) to the Labour Party.

Anthony G. Craine

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