The Luxembourg-based group also expressed optimism over its pact with state-run steel maker SAIL to establish a plant in India to cater to the rapidly expanding automotive sector.
“Merger and acquisition activity is expected to remain relatively active in the Indian steel and mining industry though at a slower pace considering the current economic slowdown,” the world’s largest steel producer said in a statement. The country has become the world’s <g data-gr-id="17">third largest</g> steel consumer after China and the US and is the world’s third largest steel producer after China and Japan, it added.
“Recent and expected future industry consolidation should foster the ability of the steel industry to
maintain more consistent performance through industry cycles by achieving greater efficiencies and economies of scale and should lead to improved bargaining power relative to customers and crucially, suppliers, which tend to have a higher level of consolidation,” the firm said.
The global steel and mining industries experienced consolidation during the ten years prior to 2008. After a pause during the credit crisis and global economic downturn of 2008-2009, merger and acquisition activity of various steel and mining players, including Chinese and Indian companies, increased at a rapid pace, it said.
However, given the current economic uncertainties in developed economies, combined with a slowdown in emerging regions such as China and India, consolidation transactions decreased significantly in terms of number and value after 2012, ArcelorMittal said in half-yearly report.