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TK Steel Americas talks said ‘intense’

Keywords: Tags  ThyssenKrupp, Essen, Brazil, coking facility, Calvert, ArcelorMittal, Nippon, Sumitomo Vale


NEW YORK — A prolonged bidding process for ThyssenKrupp AG’s Steel Americas operations in Calvert, Ala., and Brazil could be nearing a conclusion after the steelmaker said it was in "intense negotiations" with potential buyers.

"We are in intense negotiations for Steel Americas," the Essen, Germany-based company said in a statement May 3. "These negotiations include talks with our involved partner Vale (SA), Brazilian development bank BNDES and Brazilian government circles. Unchanged, we focus on a signing in due time."

News that the process may be coming to a close follows months of behind-doors bidding and negotiations for the steel production unit, which was put on the auction block last year as ThyssenKrupp looked to cut costs, garnering interest from several domestic and international competitors. A number of bidders previously confirmed some level of interest in the assets, including Luxembourg-based ArcelorMittal SA, Pittsburgh-based U.S. Steel Corp., Luxembourg-based Ternium SA and Charlotte, N.C.-based Nucor Corp. ( amm.com, Feb. 12).

ThyssenKrupp declined to comment further on the confidential negotiations. "Due to the complexity of the process and the different interests of the various parties involved, we do not provide any further details, such as concrete timetables, names or figures," a spokesman said.

However, multiple sources said that a rumored $2.1-billion bid by ArcelorMittal and Nippon Steel & Sumitomo Metal Corp. (NSSMC) for the Calvert plant remains one of the top offers, although it was unclear whether the reported bid could be revised in later stages of negotiations.

Sources also said that Brazil’s Cia. Siderúrgica Nacional SA (CSN) had been considered another possible frontrunner for either one or both of the assets, although the company said in April that it had not made a binding offer for any of the assets ( amm.com, April 2).

A spokeswoman for ArcelorMittal USA, a spokeswoman for CSN and a spokesman for NSSMC could not be reached for comment.

While sources have said the state-of-the-art rolling facility in Calvert is garnering substantial interest, some questioned whether the Cia. Siderúrgica do Atlântico’s (CSA’s) slab plant in Rio de Janeiro state has received the same reception. In 2009, AMM sister publication Metal Bulletin reported the Brazilian mill was temporarily forced to import coke due to some technical problems, and at least once source familiar with the bidding process cited those alleged earlier structural issues as a possible point of concern.

Ternium said this past week that it was no longer participating in the slab plant sale due to a "different value perception" ( amm.com, May 1). Acquiring the plant would have given Ternium self-sufficiency in the supply of slab, which is crucial as the Calvert mill does not have a melt shop.

ThyssenKrupp has a majority 73.15-percent stake in the slab plant, with partner Vale owning the remainder.

A spokesman for ThyssenKrupp did not respond to AMM inquiries about the coking unit on May 3. The German producer has said it expects to sign a sales agreement for its Steel Americas division sometime this month.


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