Brazilian integrated steelmaker Gerdau agreed to sell half of its Colombian longs mill Gerdau Diaco as a way to create a joint venture (JV), the company said on Wednesday.
According to Gerdau, it sold 50 percent of Gerdau Diaco in Colombia to Putney Capital Management for $165 million. Gerdau Diaco has an annual installed capacity of 674,000 mt.
Putney Capital Management, which is also a partner with Gerdau in the Dominican Republic through local steelmaker Gerdau Metaldom, is an assets management company with investments in the Caribbean and Central America.
Gerdau said the conclusion of the deal is subject to the fulfillment of certain preceding contractual terms from both companies.
The Brazilian steelmaker, which launched another JV this week in Pindamonhangaba, Brazil, said the deal in Colombia will help it generate more cash while helping to reduce the company’s debt.