Steel’s bout in M&A arena not over yet Fitch
Dec 31, 2007 | 10:36 AM
Fitch Ratings Inc., New York, expects further consolidation in the global steel industry in 2008 as producers seek to diversify geographically, rationalize production and gain additional access to raw materials.
The overall outlook is stable for the steel industry in 2008, Fitch said, echoing comments by Moody's Investors Service Inc., New York, last week (AMM, Dec. 28).
Analysts expect merger and acquisition (M&A) activity to consolidate as much as 35 percent of the world's steelmaking capacity among the industry's 10 largest companies within five years or less.
Globally, strong consumption trends in developing nations are offsetting weakness in the United States, Fitch said. The stage is set for steel price increases in most markets in 2008, but tight raw materials markets likely will cause margin compression for producers who don't control their sources of iron ore, coke, pig iron and scrap.....
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