The ratings on Netherlands-based Mittal Steel Co. N.V. and Luxembourg-based Arcelor S.A. were equalized following the combination in August 2006 (the group is now referred to as Arcelor-Mittal). The rating on the combined entity is underpinned by the combined group's strong business risk profile. Arcelor-Mittal is the world largest and most diversified steelmaker, with significant vertical integration into iron ore and coal. This has a stabilizing effect on margins, provides a competitive advantage in supplying global customers, and improves bargaining power with suppliers and rapidly consolidating steel-consuming industries. Pro forma the combination, in 2006, the group generated EBITDA of $15 billion on 110 million metric tons of steel production (17% of sales). Strong free operating cash flow (FOCF; $6 billion
