Lakshmi Mittal- the King of steel
It is a typical “rags to riches” story of a young man, who struggled very hard and spent a truly middle class life sleeping on uncomfortable mattresses. Now, he is the CEO and owner of ArcelorMittal, the biggest steel production company post merger in the world. Lakshmi Mittal is currently the sixth richest person in the world, according to Forbes and has a total wealth of around $21 billion. In 2006, he was the third richest man in the world. He is the second richest person in the entire European continent and the richest person in the UK. He has done his MBA from Indian Institute of Social Welfare and Business Management, the first ever business school in India.
Early life, Schooling Profile and family business
Lakshmi Mittal was born in 1950 in a Marwari family in Sadulpur tehsil of Churu district in Rajasthan. He spent his childhood in his small town home in Rajasthan, which was built by his grandfather. The house had concrete floor and he slept on cots prepared by ropes. No one knew at the time that this child was destined to become the sixth richest person in the world someday and would be called the “steel king.”
Later on, the family including his two brothers Pramod and Vinod Mittal, migrated to Calcutta, (now Kolkata) in WB. He did his B Com from St. Xavier’s College, Kolkata. Steel Business was in his genes as his father was the owner of a steel company Nippon Denro Ispat. The family had a cold-rolling mill and alloy steel plant in Nagpur and Pune respectively in Maharashtra in the 90s. His siblings Pramod and Vinod still run a large steel plant near Mumbai, though Lakshmi has no connection with it.
He started his career with Nippon Denro Ispat, the steel company of his father. Later on, due to some differences with his siblings and parents, he went on to launch his own company called as LNM Group and single handedly built the global steel empire, which later became a history.
Building an international steel empire despite hate and racism
Lakshmi Mittal started buying the ailing steel mills globally and turned them into profit making entities by cost-cutting and enjoying the benefits of larger volumes. He focused on high value products in the developing markets rather than selling the raw material in the competitive markets. Mittal’s lavish and ostentatious ways and lifestyle are not liked by the top industrial houses in Europe.
He is also hated because of racial feelings in Europe as he has attained tremendous success and control over the steel business, despite being an Indian. Recently, some video games were launched in France, where the gamers were supposed to kill Mittal, the game’s character inspired from the steel king.
Taj Mittal, one of the most expensive homes in the world
Lakshmi Mittal has such a large impact on the steel production scenario of the world that one out of every five cars uses steel produced by ArcelorMittal and the total production capacity of his company is 42 million tons of steel. He is also a very good investor at the same time. He invests his wealth in real estate and is the proud owner of many wonderful properties around the world. His current residence is in Kensington Palace Gardens, which is a street in west central London, known as the “billionaires’ row” for being the most expensive residential streets in the world. The marble used to make this villa is the same as the one used in the famous Taj Mahal in Agra. That’s the reason it’s known as “Taj Mittal.”
Extravagant ways Lakshmi Mittal is hated in Europe for his extravagant ways. He married off his daughter Vanisha Mittal in one of the most luxurious weddings ever to investment banker and philanthropist Amit Bhatia. The wedding budget was well over US$ 80 million and the party lasted for more than a week. The choice of the venue for the extravagant wedding was a cause of envy among the richest persons in the world. It was the magnificent and grand, Palace of Versailles, the erstwhile court of former French kings. It’s called as the ‘the finest castle and garden’ in France.
Lakshmi Mittal is also a philanthropist and a generous person at heart. He was so sad to see the plight of Indian sports in the Olympic arena that he donated some $9 million to train and groom the most talented sportspersons in India.
Similarities with Andrew Carnegie, the erstwhile steel king of the US
Around a century ago, when immigrant Scot Andrew Carnegie sold his steel company Carnegie Steel for $500 million, his financier shouted with joy that Carnegie had become the richest person in the world. Carnegie and Mittal share many things. Both of them were migrants and had spent their childhood in poverty. Both started successful steel businesses in a foreign land and dominated their businesses so well that they were referred to as the kings of steel in their own lifetimes.
Similar to Mittal, Carnegie the Scottish gentleman also became America’s richest and most aggressive businessman by sheer hard work and determination. Carnegie was also a great philanthropist and financed around three thousand libraries worldwide.
Formation of ArcelorMittal and its global leadership
Mittal’s takeover bid for Arcelor was a long drawn and bitter battle and was accompanied with racist resistance. But, he did not give up and finally proposed a revised offer worth $33 billion, which was accepted by Arcelor and it sealed the position of Lakshmi Mittal as the undisputed king of steel in the world. After this takeover he instantly became the third richest person in the world only next to Bill Gates and Warren Buffet. His total worth is estimated to be around $24 billion.
Mittal Steel and Arcelor were the top two steel producers in the world, (Mittal being on top) even before the merger. But, after the takeover they became a giant company that was three times larger than their nearest competitor. ArcelorMittal now produces around 10% of the total global steel production capacity.
Assets and buying spree of Mittal
Lakshmi Mittal believes in acquiring and buying businesses and properties and he has assets in many countries in the world such as Ukraine, South Africa, US, France, Romania, Indonesia, Poland and Kazakhstan.
Impact of recession on ArcelorMittal
The bad economy and competition from China are responsible for the shrinking demand for steel and idled capacity at the plants. Hence ArcelorMittal’s profits have shrunk to one third of its 2007 value, however if the economy bounces back, Mittal is all set to become the steel king again.
Salary of Lakshmi Mittal
As per the annual report of ArcelorMittal for 2013, Mittal was paid $2.29 million as salary and perks, it is 38.29% down from 2012's salary $3.71 million
Last Updated: July 4, 2013