Steel Americas deal doubtful
August 13, 2013
German steel giant ThyssenKrupp was considering keeping its loss-making steel mill in Brazil, while selling its US processing plant in Alabama to Brazilian steelmaker CSN, the US business newspaper Wall Street Journal reported Tuesday.
The US plant in Calvert, Alabama, was planned to be sold off for $1.5 billion (1.12 billion euros), the newspaper quoted a source familiar with the negotiations as saying.
The deal would also include a CSN guarantee to purchase three million tons of steel a year from ThyssenKrupp's mill in Rio de Janeiro, which together with the Calvert plant form the German firm's Steel Americas division.
In May 2012, ThyssenKrupp decided to shed its lossmaking division which had cost the German steel giant 12 billion euros to build and operate, but which has never made a profit.
Currently, the two plants' book value is around 3.4 billion euros after huge writedowns aimed at cleaning up ThyssenKrupp's balance sheet.
Originally, the German steelmaker had planned to sell the two plants in a package. But deals with Brazil's steel companies Vale and Siderurgica fell through over price disputes.
According to the Wall Street Journal, another option that now remained on the table was a joint bid by Indian steelmaker ArcelorMittal and Nippon Steel from Japan which had an interest in buying the Alabama plant.
On Tuesday, a spokesman for ThyssenKrupp said the company was in intensive talks with more than one bidder and planned to sell Steel Americas in a timely fashion.
uhe/dr (dpa, Reuters)