European takeovers | Powerless patriots

European politicians cannot do much to stop Mittal Steel's bid for Arcelor

Dominique de Villepin, the French prime minister, remained conspicuously silent in the first days after his government was surprised by the news of Mittal Steel's hostile bid for Arcelor, a European steelmaker, with almost 30,000 employees in France. On January 31st he broke his silence in a televised address with a call to arms. “Economic patriotism is the mobilisation of all the participants, of all those concerned, the shareholders but also the company bosses,” he said, urging French and other European chief executives to be better organised to resist attacks by foreign companies.

Thanks to France's increasingly protectionist mood, corporate takeovers are a sensitive topic in Europe. Last week Charlie McCreevy, the internal market commissioner of the European Union, sent Thierry Breton, France's finance minister, a letter demanding justification for provisions in new legislation that gives the government the right to veto or impose conditions on takeovers in 11 industries. If he is not happy with Mr Breton's reply, due before the end of this month, the commissioner will take legal action.

See full Article.