ANNUAL REPORT ARCELOR 2003 - paperJam

2003 highlightsOn January 24, 2003, having been advised of theconclusions of strategic studies analysing thecompetitiveness of the production structures in Europe,the Arcelor Board of Directors defined the Group’s broadstrategic orientations and laid down the industrialinvestment policy for the Flat Carbon Steels sector.This policy will mean concentrating the liquid phaseequipment (blast furnaces, conversion steelshops) atthe more efficient coastal sites. At sites where thesemeasures will have an impact on employment, theGroup made the commitment to set up the necessaryprogrammes to assist in employee retraining and forreindustrialisation in the local labour market.On May 15, 2003, the Board of Directors was informedby the Group Management Board of the conclusionsdrawn from strategic studies in respect of the StainlessSteels sector. The Board asked Management to prepareto implement a construction project for a new steelshopupstream of the Carlam hot strip mill at Charleroi,Belgium.This project, based on maintaining current capacity,would enable the entire European flat stainless steelbusiness to attain world-class levels of competitiveness.The investment project in Charleroi amounts to 230 millioneuros and will create 400 new jobs. Commissioning isplanned for the second half of 2005, and the ratedcapacity of one million tonnes is due to be reached in2007.This project is part of the larger strategic realignmentsdesigned to optimise the industrial and economicperformance of all of the Group’s stainless steel activitiesas part of better asset portfolio management.On July 3, 2003, Arcelor finalised the purchase, throughsubsidiaries of its long products sector, of the Pallanzenorolling mill from Duferdofin and of a 49.9% share in theSan Zeno steelworks. Duferdofin, a wholly-ownedsubsidiary of the Duferco Group, retains the remaining50.1% shares in the San Zeno steelworks.The two purchases have been approved by the Europeancompetition authorities.The Pallanzeno rolling mill, located in northern Italy,produces small and medium beams and has a productioncapacity of 600,000 tonnes per year; the steelworks atSan Zeno di Naviglio, also located in Italy, near Brescia,has a capacity of 750,000 tonnes per year and suppliesblooms* to the Pallanzeno rolling mill.On July 28, 2003, Arcelor granted a technologicallicense to Tata Steel of India for the production of galvanisedsteel sheet for automobiles at its Jamshedpurplant. The agreement covers both the pure zinc galvanisingtechnologies and combined zinc/iron coatings.This agreement reinforces the cooperation initiated inApril 2002 between Arcelor, Nippon Steel Corporationand Tata Steel aimed at offering high-performance steelsolutions to the Indian automotive industry. Under thenew agreement, Arcelor is granting Tata Steel a licensefor the use of its proprietary product Extragal TM , includingthe use of the registered trademark and the necessaryknow-how. Extragal TM is a pure zinc galvanised productthat has been specially developed for the automotiveindustry.* See glossary.16ANNUAL REPORT ARCELOR 2003