Its current business plan is based on market forecasts for steel, which project demand to grow from 3.6 per cent to 4.5 per cent by 2010, offsetting chances of annual fall in steel prices. Mittal Steel expects earnings before interest, tax, depreciation and amortisation (EBITDA) to reach $9.9 billion in 2008, up from $5.8 billion in 2005. This does not include the $25 billion provision for purchasing Arcelor, which turned down Mittal''s takeover bid on Monday. Nor does it take into account any acquisitions in the M&A pipeline, greenfield developments or Mittal Steel''s minority stake in Hunan Valin of China.

Operating income for the current year is expected to touch $6.1 billion, compared to $4.7 billion in 2005. Full-year shipments are projected to reach about 60-million tonnes. The company also sees $3.35 billion investment growth in 2008, funded by own finances.

While gross incremental EBITDA for 2008 is estimated at $5.3 billion, net incremental EBITDA is expected to total $3.3 billion, after an anticipated price squeeze of $2.0 billion. The company also sees further value creation through commitment to earnings enhancing transactions.

A merger between Mittal and Arcelor would create a steel production capacity of more than 100 million tonnes per year, three times that of Nippon Steel, its closest rival.

Lakshmi Mittal, CEO, Mittal Steel, said the firm would benefit from consolidation of its business in developed and developing markets "by leveraging on technology leadership to upgrade production while benefiting from strong blue-chip customer relationships in developed markets."