With the low demand of steel by industries, some steel companies are suffering a big loss, even large contributors like Lakshmi Niwas Mittal. Here is the report on the downfall of Lakshmi Niwas Mittal after he owned the 41 percent stake of the ArcelorMittal.
In 2006, Mittal owned Arcelor and became the biggest steel manufacturer in the world. Then in 2008, he bought the most expensive villa in the “billionaires lane” Kensington palace gardens area of London. However, now he is on terms of selling it to buyers, because of the loss he is facing due to the low demand of steel.
Referred to as the “Steel King”, Mittal was the richest person in Britain for eight consecutive years. Unfortunately, due to big losses in steel production, he presently stands in the fourth position. According to industry analysts Mittal has debts that amount to approximately $5 billion.
Mittal and his wife Usha have 41 percent stake in Arcelor. Mittal whose value was $50 billion last year, is now reduced to $11 billion which was a dramatic drop of 80% in a year. In 2012 the company faced the loss of $4 billion. Last year, he was at no. 21 in the list of millionaires and now her has dropped even further the the 42nd spot. His total personal wealth is $14 billion.
In order to remove himself from this finacnial crisis, Lakshmi Niwas Mittal had to do two things:
1- Due to low product demand, he decided to close some units in France.
2- He started selling properties he considers to be unimportant. The villa at the Kensington palace gardens is one of those properties.
Mittal bought the villa for his son Aditya Mittal who is the CFO of ArcelorMittal. Mittal bought the house from the Israeli-American financier Noam Gottesman at a hefty amount of $205 million in 2008. This deal was stated as ‘overpaid’ by property analysts as Mittal paid more than the actual property rates of that area. Now he is selling it at the price of $192 million with a straight loss of $13 million due to the reduced rates of property in area.
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