Swot Analysis Of Arcelormittal
Name of the company- ArcelorMittal Business Section-Steel Operating Geography- Luxembourg, Global Revenue- US 65.196 $ billion FY ending December 2015 About the Company- Headquartered in Luxembourg, ArcelorMittal is the world’s largest steel producer. It was formed from the merger and takeover of West European steelmaker Arcelor by the Indian owned Mittal Steel in 2006 for a sum of $33 billion. Strengths 1. Global Leader 2. Research & Development 3. Geographic Diversity 4. Diverse Market portfolio 5. Vertical Integration Weakness 1. Indebtedness 2. Closing down of operations 3. Lower realizations from mining operations Opportunities 1. Deleveraging 2. Increasing demand in growing economies 3. Government policies to prevent dumping Threats …show more content…
Lower realizations from mining operations- There are high uncertainties involved with the mining business, and as ArcelorMittal has its own mining operations, in geopolitical risky places such as Liberia and Mozambique, where unrest is common. Also, as it owns its own mines, it cannot realize the decrease in the input costs. Opportunities 1. Deleveraging- ArcelorMittal to strengthen its core asset base has sold off Gestamp for USD $ 1 billion. The company also converted bonds worth USD $ 1.8 billion, and announced USD $ 3 billion rights issue in a bid to reduce its massive debt and structure its business. As a result, the company has seen a reduction in interest payments of $800 million than they were in 2012. [6] 2. Increasing demand in growing economies- Owing to the factors such as implementation of government schemes and internal demand, the steel demand for growing economies, especially that of India is set to stabilise. Brazil and ASEAN countries too are set to pick up a moderate growth, and thus it’s important for ArcelorMittal to have a strong presence in these growing economies. 3. Government policies to prevent dumping- The US government has put in policies to prevent places like China from dumping excess steel into the market. This can be seen as an opportunity for ArcelorMittal which has the USA as its big market to improve its
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