Lakshmi Mittal Case Study

INTRODUCTION

Born in Sadalpur, Rajasthan, India on 15th June 1950 is the 8th richest man in India and 85th richest man on planet earth currently. He is no other than Lakshmi Mittal, CEO and chairman of Arcelor Mittal steel company. Originating from a middle class family who lived in a village deprived of basic necessities such as water and electricity at that time, Lakshmi Mittal has come a long way and proven that anyone can be successful. His journey in this field started when he was pursuing his studies in St. Xavier’s College as a business and accounting student where he worked at his dad’s small steel plant after classes. Through this he gained knowledge as well as experience, which was invaluable.

HIS CAREER

After graduating with

Over the years he grew his business by buying over unprofitable mills, turning them into profitable ones. He opted for brownfield strategy instead of greenfield strategy because building from scratch would take a long time. His acquisition list grew from Sircasta in 1992,the third largest steel producer there, a steel plant in Kazakhstan and Germany in 1995 and the formation of Ispat Shipping and Ispat International Limited to support the growing business. When Mittal identified Kazakhstan, which is bordered by China he knew business in China was growing and China needed steel to build airports, highways and high rises. The state owned plant in Kazakhstan was in poor financial state and the president wanted to privatize it. Mittal grabbed the opportunity and purchased the plant at a minimum price of USD400million. Salaries of workers in the plant were not paid for months. Local railways station and trams were at a lost. Mittal used a regiocentric strategy where he employed Russian-speaking Indians managers to work and bought the local railway and tram services. In a year the plant was making profit, labour were paid every 15days and production