New Delhi: The International Iron and Steel Institute (IISI) has said it would oppose any merger move by BHP Billiton and Rio Tinto as it could could pose a serious threat to the interest of the steel producers by creating monopoly.
On behalf of steel producers worldwide IISI secretary general Ian Christmas urged all relevant competition authorities of the European Union, Japan, the US, China and Australia to review the proposed merger and recognize the threat it poses to the interests of steel producers and general public.
“Any further consolidation between the big three would create a virtual monopoly in the business. For this reason, not only will the steel industry strongly oppose the potential merger... but it is vital that the competition authorities in the EU, USA, China, Australia and Japan also recognise the threat... to the interests of steel consumers and the general public,” the statement quoted Christmas as saying.
“This merger is not in the public interest and should not be allowed to proceed, he said.
IISI also supports the consolidation of steel businesses but not to the extent of creating a monopoly. Even the largest steel company in the world today accounts for less than 15% of total world steel production, he pointed out.
“In sharp contrast the business of seaborne iron ore is dominated by just three companies. CVRD, Rio Tinto and BHP Billiton account for over 70% of total world trade, he pointed out.