Dofasco Under Attack

News out on Wednesday, Arcelor put an offer out to the shareholders at $56...this was overdue. Dofasco has been a prime target for over a year, so it was just a matter of time. Of interesting note, was this excerpt from S&P the day of the announcement;

TORONTO (Standard & Poor's) Nov. 23, 2005--Standard & Poor's Ratings Services today said it placed its 'A-' long-term corporate credit and senior unsecured debt rating on Dofasco Inc. on CreditWatch with negative implications after Luxembourg-based Arcelor S.A. (BBB/Stable/A-2) announced a C$4.3 billion unsolicited cash offer for the company's shares. The CreditWatch stems from the likelihood that the ratings on Dofasco would be lowered two notches to be equalized with those on Arcelor if the transaction is completed.

My guess is that there will be someone else that comes into the picture and makes a grab for Dofasco. If I had to guess, Gerdau SA (or TK) might come in as white knights and compete. I think that it will be sold at $64, with QCM included.