Under the terms of the agreement, Metal Management investors will receive 2.05 American depository receipts of Sydney-based Sims for each of their shares. Upon closure of the transaction Sims shareholders will own about 70 percent of the combined company.
The name of the new company will be changed to Sims Metal Management, while the head office will be moved to New York.
An official statement issued by Sims Group said that the merger in question will strengthen Sims' position in the global market and create the largest North American metal recycling business, with premium assets and a strong platform for further growth.
The merger will be subject to the approval of Metal Management's stockholders and other conditions.