Brazil's antitrust authority, Cade, approved Gerdau to form a wind power joint venture (JV) with Sumitomo Corporation and Japan Steel Works (JSW), in order to meet the growing demand of the country's wind sector segment. The regulator approved the deal with no restrictions.
Gerdau confirmed the JV's plans to start producing parts for the wind power sector by 2017, but said shipments should start by the end of the year.
The facility will be established in the city of Pindamonhangaba, in the state of Sao Paulo, within Gerdau’s existing steelmaking complex.
As it starts production by late 2017, the plant will produce forged parts for wind power generation towers, among other products, including equipment for the wind power sector, as well as cylinders for the steel and aluminum industries.
Total capacity should reach 50,000 mt/year, Gerdau confirmed, adding that the JV is expected to invest some BRL 280 million for acquiring new equipment and starting production.
Gerdau said it should contribute "mainly" with assets to the production of cylinders, as well as provide specialty steel for the manufacturing of parts for wind power generation towers.
"The wind power industry is a market with high growth potential in Brazil, and in the next years the partnership with Sumitomo and JSW willl allow [us] to develop high technology products for our clients, and ultimately, it will generate good business opportunities," said Gerdau's specialty steel director, Fladimir Gauto.