Steel Strip

The world’s steel industry yesterday declared its opposition to BHP Billiton’s ambitious proposal for a $150bn takeover of mining rival Rio Tinto.

The Brussels-based International Iron and Steel Institute, which represents many of the world’s steel makers, warned that an alliance of the two would create a near-monopoly. "This deal is not in the public interest and should not be allowed to proceed," IISI secretary general Ian Christmas said.

The Japanese Iron and Steel Federation was equally robust in its opposition. "BHP’s acquisition of Rio Tinto would create a huge Gulliver and would impede a healthy price mechanism," federation chairman Hajime Bada said yesterday. "We are opposed to such an acquisition."

The IISI, which represents 180 steel companies, including 19 of the world’s top 20, is calling on competition regulators in the European Union, the United States, China, Australia and Japan to recognise "the threat this merger poses to the interests of steel consumers and the general public".

BHP Billiton has sought to play down concerns about the huge bargaining power, not least in the iron ore market, that a combined group would wield.

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