Brazilian steelmakers ArcelorMittal Brazil and Votorantim Siderurgia announced Thursday they will combine their long steel operations in the country.
Under the terms of the deal, Votorantim Siderurgia’s assets in Brazil will be part of ArcelorMittal Brazil’s portfolio. Votorantim’s mills in Argentina (Acerbrag) and Colombia (Acerias Paz del Rio) were not included in the deal, according to ArcelorMittal Brazil.
“The combination of the businesses will result in a long product steel producer with annual crude steel capacity of 5.6 million mt and an annual rolling capacity of 5.4 million mt,” said a statement from ArcelorMittal Brazil.
The combined portfolio of the two companies will include ArcelorMittal’s mills in the cities of Monlevade, Cariacica, Juiz de Fora, Piracicaba and Itauna, as well as Votorantim Siderurgia’s mills in Barra Mansa and Resende, in addition to its participation in Sitrel, which is located in the city of Tres Lagoas.
“The merger is expected to generate cost, logistical and operational synergies. The combined businesses production facilities are geographically complementary, enabling closer proximity, and higher levels of service, to our customer base,” ArcelorMittal added.
The deal is still subject to the approval of Brazil’s anti-trust authority, Cade. Until then, ArcelorMittal Brazil and Votorantim Siderurgia will remain operating as separate and independent companies.