On March 2, the world's largest steelmaker Luxembourg-based ArcelorMittal announced that it has signed agreements to acquire 40 percent in Thailand-listed G Steel Public Company Limited (GSteel).
According to a company release, by acquiring hot rolled coil producers G Steel and Thailand-listed subsidiary GJ Steel Public Company Limited (GJ Steel), ArcelorMittal is partnering with a group of major shareholders represented by the Leeswadtrakul family, the founding shareholder.
G Steel has an EAF-based medium slab rolling facility in Rayong and GJ Steel has an EAF-based thin slab rolling facility in Chonburi, with a combined annual capacity of over 2.5 million metric tons per annum. The companies together have over 1,400 employees.
ArcelorMittal has also signed a credit facility agreement with G Steel and GJ Steel for USD 500 million for working capital, capital expenditure and other corporate purposes.
The amount of capital to be invested by ArcelorMittal will be determined closer to the completion of the transaction. Completion of the transaction is conditional on a reduction in the outstanding liabilities of G Steel and GJ Steel and a range of other conditions, including regulatory approvals and approval of the shareholders of G Steel and GJ Steel.
Aditya Mittal, CFO and member of the group management board of ArcelorMittal, said: "G Steel is an important component of our overall emerging markets strategy and will provide ArcelorMittal with a major manufacturing presence in Thailand and the ASEAN region where we expect steel demand to continue growing. Dr. Somsak Leeswadtrakul has built a high quality operation. We are confident that our global expertise and investment will develop the company's potential and will facilitate an operational, financial and commercial turnaround."