Severstal sale stirs more AK questions

Jul 22, 2014 | 05:39 PM | Thorsten Schier

Tags  Severstal, Dearborn plant, Columbus mill, Steel Dynamics, SDI, AK Steel, Jefferies, Cowen Thorsten Schier

NEW YORK — Steel market analysts largely agreed with initial market sentiment that Steel Dynamics Inc.’s (SDI’s) purchase of OAO Severstal’s Columbus, Miss., facility is a slam dunk, while more questions surround AK Steel Corp.’s acquisition of the Russian steelmaker’s Dearborn, Mich., mill.

Analysts at New York-based Jefferies LLC said the strategic rationale for both deals was "sound" due to increasing geographical and product diversity for SDI and improved operational flexibility and logistical improvements for AK Steel, but they noted the AK Steel deal poses risks in the form of potential antitrust concerns and financing issues.....

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