Global steel tycoon Lakshmi Niwas Mittal made his M&A debut in India by picking up 20 per cent stake in the Rs 4,371-crore Uttam Galva Steel Ltd.

Uttam Galva is a BSE-listed mid-sized company promoted by the Miglanis. Its plant at Khopoli in Maharashtra produces 7.5 lakh tonnes of galvanised steel and 1 million tonne of hot- and cold-rolled coils a year.

Arcelor-Mittal has taken half the promoters’ shares in the company. The Miglanis' stake, at almost 41 per cent in Uttam Galva, will now be pared down to 20 per cent. The stock closed 10 per cent higher at Rs 113.70 on the Bombay Stock Exchange.

As per Sebi guidelines, Arcelor-Mittal will now have to make an open offer to acquire another 20 per cent in the company. Institutions and mutual funds hold 39 per cent in the company while individuals hold 12 per cent.

Mittal has been struggling for over three years now to set up two greenfield projects in Orissa and Jharkhand, entailing a total investment of Rs 80,000 crore. Both are mired in bureaucratic procedures. Today’s deal is the world’s biggest steelmaker’s first ever acquisition in India.

Though Uttam Galva did not disclose the financial details of the deal, it said Arcelor-Mittal would nominate half the non-independent directors on its board. The board that met today evening approved a ‘co-promotion agreement’ with Arcelor-Mittal. The Western India-based steel maker informed the bourses that an open offer would be made by Arcelor Mittal Netherlands BV.

Based on the company's current market value, the Miglanis’ stake is worth over Rs 500 crore. If the

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