A New Goliath In Big Steel

Lakshmi N. Mittal, the Indian-born steel tycoon, has built a $6.4 billion personal fortune on the scraps and remnants of aging steel companies from Algeria to Poland to Mexico. He also knows how to spend the enormous wealth that success has brought him. Last April, Mittal dropped $128 million on a 12-bedroom neo-classical mansion in London's fashionable Kensington. Two months later, he hosted 1,000 guests in and around Paris for his daughter's weeklong wedding celebration. The festivities included a formal bash at the Palace of Versailles and cost a rumored $50 million.

But what the 54-year-old Mittal really likes to spend his money on is buying more steel mills. In his biggest move yet, Mittal announced a deal that will create the world's largest steelmaker, with estimated annual revenue of $31.5 billion. The two-step transaction first unites Mittal's European companies -- Ispat International (IST ) and LNM Holdings -- in a $13.3 billion merger. The new entity, Mittal Steel Co., will then acquire International Steel Group (ISG) in Richfield, Ohio, for $4.5 billion. By enlarging Mittal's U.S. holdings with ISG, Wilbur L. Ross Jr.'s collection of once-decrepit but now revamped U.S. steel factories, the transaction unites four of the seven largest old-line U.S. steelmakers that existed in 2001 -- LTV, Bethlehem Steel, Weirton Steel, and Ispat Inland Steel. Assuming the deal passes regulatory muster, as industry insiders expect, Mittal predicts the transaction will be completed by next April.