MONTERREY, Mexico — Ternium SA has confirmed its interest in ThyssenKrupp AG’s steel assets in the Americas, with the unit’s slab mill in Brazil of particular interest to the global steelmaker, according to Ternium Mexico chief executive officer Máximo Vedoya.
"We’re a (major) consumer of slabs and we are mindful (of the bidding process.) We’re watching, observing, looking at this process," Vedoya told delegates at AMM’s 18th Annual Mexican Steel Forum in Monterrey.
Vedoya declined to comment further on Luxemburg-based Ternium’s progress in the bidding process or the value of its bid, citing confidentiality agreements.
"There are many things we cannot discuss in public," he said.
Ternium has been rumored as a possible suitor for the ThyssenKrupp operations for some time. Other major steelmakers, including Charlotte, N.C.-based Nucor Corp., Luxembourg-based ArcelorMittal SA and Posco Ltd., Seoul, South Korea, have also confirmed their interest in the assets, which were put on the auction block by the German steelmaker last year.
ThyssenKrupp originally said it aimed to recoup the roughly €7-billion ($9.4-billion) book value of its Steel Americas assets—which include the Brazilian slab mill and a U.S. rolling mill in Calvert, Ala.—if it completes a sale (amm.com, Aug. 28). It has since announced a €3.6-billion ($4.7-billion) write-down on the assets (amm.com, Dec. 12).
The company began looking for buyers or partners for the operations when it deemed its model of shipping Brazilian slabs to finishing facilities in the United States was no longer profitable (amm.com, May 15).
It’s too early to say who will emerge victorious in the bid for the Americas operations, but according to Vedoya, the "dynamic" trade relationship between the U.S. and Mexican steel and manufacturing sectors is unlikely to change following the sale, even if a company with a strong Mexican presence like Ternium takes control.
"If ThyssenKrupp has the Alabama plant or Nucor or U.S. Steel (Corp.) or Ternium or whichever one buys it, competition already exists, so I don’t believe there’s going to be a very great change in the dynamics of trade or the competition between Mexico and the U.S.," he said.
"Whoever wins the bid, it doesn’t matter—the Americans or whoever—trade between Mexico and the U.S. is extremely dynamic," Vedoya added.