ThyssenKrupp AG reconsidering sale of Brazil steel facility
German steelmaker ThyssenKrupp AG had spent nearly a year and a half trying to divest its Americas unit may decide to retain its plant in Brazil and sell off only its US operations. This was the information from two sources familiar with the transaction undertaken byt he firm.
The deal to sell its US steel mill would require some of the Brazilian plant's output to be done in the Alabama facility according to one of the people who requested anonymity because the talks are confidential. The bids submitted for the Brazilian plant have been to low, leading ThyssenKrupp to accept that their Americas division would not recover the EUR3.4 billion or USD4.5 billion book value. It is also expected that another write down would be done because of this.
The German firm has been trying to sell its Americas unit and expand its non-steel operations to ride out the decline in global steel demand. The decreased consumption in key industries that use steel, such as the auto and construction markets, as well as higher competition at lower prices from China had resulted in a drop in steel prices.
The most interesting suitor is Brazil's Cia. Siderurgica Nacional SA or SCNA3, who is interested in the US plant. The said facility is expected to be priced at USD1.5 billion according to one of the sources. Back in May, another firm, CSN was said to be at the forefront to purchaae the Steel Americas unit.