Steel Deal Controversy
(12th February 2002)
Lakshmi Mittal's latest deal to acquire Romanian steel making business
Sidex has become mired in controversy. At the centre of the furore
is the question of UK Prime Minister Tony Blair's role in clinching
the multi-million pound deal for Mr Mittal, the steel magnate.
answer to questions yesterday about the Prime Minister's letter
to the Romanian Prime Minister regarding Lakshmi Mittal's bid for
nationalised steel company Sidex, the Prime Minister's Official
Spokesman underlined that the letter had been written as a direct
result of a recommendation suggested by the British Ambassador to
Bucharest and had subsequently been endorsed by the Foreign Office.
seems that neither the Ambassador nor the Foreign & Commonwealth
Office had been aware that Mr Mittal had donated £125,000
to the Labour Party that year. Both had suggested writing the letter
because of the transformation going on within Romania, particularly
in terms of the restructuring of its economy - of which Sidex was
playing a very important part.
letter, in which the Prime Minister said: "I am particularly
pleased that it is a British company which is your partner. This
should send a very positive signal to investors and businessmen
in Britain and more widely. Together with the other measures you
are taking, I hope it will stimulate renewed interest by British
business in Romania" has further enraged members of the Plaid
Cymru who argue that Corus, as opposed Mr Mittal's LNM group, is
the chief provider of steel jobs in Britain.
Mittal's company, LNM is an international conglomerate headquartered
in London. ISPAT International is the LNM subsidiary that operates
in the steel-making industry. The company employs around 125,000
worldwide but has only about 100 people based in the UK. The company
itself is registered in the Dutch Antilles. Mr Mittal whose company
was valued at around £1.2billion in 2001 regularly tops the
Asian Rich List.
Street countered accusations by stating that " it was in this
country's interest for its businesses to be helped to open up new
market and that the Government had spent £60m to help the
steel industry in the UK adapt."
here if you want to discuss
some of the issues raised here.