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ArcelorMittal, TK close deal for Calvert facility

Feb 26, 2014 | 05:09 PM |

Tags  steel sheet, ArcelorMittal, ThyssenKrupp, Nippon Steel & Sumitomo Metal, Calvert, acquisition, Lakshmi N. Mittal, Catherine Ngai


NEW YORK — ArcelorMittal SA and Nippon Steel & Sumitomo Metal Corp. have closed their deal for ThyssenKrupp AG’s Calvert, Ala., facility, the companies said Feb. 26.

"The successful completion of this transaction is an important milestone for ArcelorMittal," ArcelorMittal chairman and chief executive officer Lakshmi N. Mittal said in a statement. "Along with (Nippon Steel), we are now the owners of the most modern steel finishing facility in the world, which will allow us to meet rising demand for steel in the automotive, energy and other important Nafta (North American Free Trade Agreement) markets."

A national sales meeting has been slated for the beginning of March to discuss plans after the closing of the deal, two market sources told AMM.

ThyssenKrupp had been selling more competitive lately, one competitor mill source told AMM. "It’s been strange to see and I don’t understand why they’re trying to shed inventory," he said.

The deal could be good news for the industry, coming on the heels of a softening in the steel sheet market plagued by cold weather, short lead times and falling prices.

The move fuels expectations among market players that ArcelorMittal will begin discussing the next steps toward consolidating production. A number of buying sources had told AMM in recent weeks that the purchase of ThyssenKrupp Calvert could be good news if ArcelorMittal makes a widely expected announcement to take capacity offline in the near term, particularly as that move would tighten the sheet market.

But earlier reported plans to run the Calvert facility at full capacity—without a ramp down or consolidation among its facilities—could mean the deal could hurt the steel market due to oversupply, sources said.

Essen, Germany-based ThyssenKrupp announced the sale of its $1.55-billion facility to Luxembourg-based ArcelorMittal and Tokyo-based Nippon Steel in December (amm.com, Dec. 1) and the deal passed U.S. regulatory antitrust approval last month (amm.com, Jan. 30).




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After witnessing the pace of steel plant idlings and worker layoffs during the first half of the year, what is your view of the second half of 2015? (choose one)

No matter what else happens, layoffs and shutdowns, etc., have nearly or essentially stopped for the year.
The environment will change little and the pace of layoffs will continue at a similar rate as the first half of 2015.
The environment will change little yet the pace of layoffs will begin to slow slightly to moderately.
The environment will change little yet the pace of layoffs could exceed the rate seen thus far.
The environment will improve slightly to moderately yet hiring and plant restarts will not resume this year.
The environment will improve slightly to moderately, with hiring and plant restarts commencing.
The environment will improve dramatically yet hiring and plant restarts will still be negligible in comparison.
The environment will improve dramatically yet hiring and plant restarts will only be slight to moderate.
The environment will improve dramatically, with hiring and plant restarts occurring nearly in tandem.


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