- Richest of the Rich position: 20
- Birth/Death: diedob 02/09/1950
- Origin of wealth: Steel
- Wealth: Â£19.25bn
- Net National Income: Â£1,065bn
- Net National Income Percent: 1.80%
- In Today’s Money: Â£19.25 billion
Lakshmi Mittal stunned the world’s steel industry in early 2006 with an audacious takeover bid for Arcelor, the second biggest steel maker in the world after Mittal Steel. By June 2006, after an acrimonious bid battle, he finally secured the Luxembourg and French based operation for Â£17.8bn. Arcelor Mittal, as the new venture is called, is the world leader producing 115m tonnes of steel, around 10% of the market. It was a bold move and Mittal says that cost savings are on track and the merger was going ‘beautifully’ as the two companies had complimentary skills.
Mittal, whose wealth has grown by acquiring and turning round ailing, formerly state-owned mills around the world, knows all there is to know about steel and wants to end the fragmentation of the industry and its constant boom-bust cycles. Though he likes to describe himself as a son of the desert from Rajasthan, he learnt about business and steel industry in Calcutta. His father, Mohan, had moved to the city after Partition and built up a steel operation, while young Lakshmi excelled at university, topping his class in business and accountancy.
After working in the family business, Mittal moved to Indonesia in 1976, reckoning that at the time ‘Indian conditions were very suffocating for growth and development’. With backing from his father, he founded a steel plant and by the mid 1980s was a serious player in the world’s steel community. In 1995, he separated his own steel operation from the family’s Indian businesses, and went his own way. Mittal settled in London, where he loves to live, though retains his Indian passport.
The family’s stake in Mittal Steel prior to the completion of the merger in early 2007 was worth nearly Â£17bn as the shares had risen sharply. The family will emerge with around 43.4% of the new entity. From 1998 to 2005, the Mittals received Â£1.57bn in dividends from its steel operations, including a bumper Â£1.38bn in 2004. Some Â£434m of this has been reinvested elsewhere, leaving Â£1.13bn in family hands. The Mittals will receive at least Â£413m in dividends from the new group in 2007.
A separate investment portfolio is now worth around Â£570m, while Mittal also has a small Indonesian steel business, which is not part of the main group, worth nearly Â£146m. Among his British investments, Mittal has a 4.3% stake worth Â£10m in the quoted RAB Capital hedge fund via his private vehicle Karrick Trust.
While Mittal has a Â£9m pile in London’s exclusive Bishop’s Avenue, he also set a world record for a private home when he paid a reputed Â£70m to Bernie Ecclestone, the Formula One supremo, for a house in Kensington Palace Gardens. In June 2004, he also splashed out Â£30m for his daughter’s wedding.
The separate investments and other assets together add around Â£2bn. In all, we estimate that the Mittal family is now worth in the region of Â£19.25bn.