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Ruling in Mittal SA Competition Commission tribunal expected after Easter recess

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Mittal Steel SA could face closure in the long term if they are to change their pricing model. Mittal Steel SA is currently facing a case at the South African Competition Commission Tribunal on their import pricing model. The case was brought to the Competition Commission by some local steelmakers saying their import parity model was unfair. The deputy chairman of the financial consulting company CRA International and a specialist in competition law, Mike Walker was called as a final witness in the tribunal. "I don't propose that Mittal shut down immediately. It has its assets and should continue using them," said Walker. He tried to prove that the pricing structure was not extraordinarily high. He said that if it is viewed historically, Mittal SA will not be able to earn enough during the steel purchasing cycle in order to recover its weighted average capital cost (WACC). The local companies who brought the case to the commission disputes this saying they will be faced with a bleak future if Mittal continues with their current pricing. The commission is expected to make its ruling after the current Easter break of about 2 weeks. (Apr. 16)
News Date 16 Apr 2006 11:36:19 reported by Customer service

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