Australian steel producer BlueScope has responded to a new non-binding takeover proposal from a consortium comprising Australia-based SGH Limited and US-based steelmaker Steel Dynamics.
After reviewing the revised proposal with management, external advisers and major shareholders, the board stated that the offer of A$32.35 per share in cash does not adequately address valuation concerns. BlueScope reiterated that a previous proposal from Steel Dynamics implying a value of A$33.00 per share and the initial A$30.00 proposal dated December 12, 2025, from the consortium had already been rejected for significantly undervaluing the company. Nevertheless, the company indicated that it remains open to a transaction if the proposal better reflects the company’s fair value for shareholders.
Questions raised over structure of North American asset sale
Under the proposed transaction structure, SGH would acquire all shares in BlueScope and subsequently sell the company’s North American operations to Steel Dynamics.
BlueScope stated that it has repeatedly requested clarification on how value has been attributed between the North American business and the company’s remaining global operations. The board noted that such information is necessary for both directors and shareholders to properly evaluate the proposal.
The company also asked the consortium to clarify whether the planned sale of the North American assets to Steel Dynamics is a condition of the acquisition and how it might affect execution risk and the timing of the transaction.
Board seeks clearer financing commitments
BlueScope also raised concerns regarding the financing structure of the proposal. Although the revised offer states that it is not subject to financing conditions, supporting letters from J.P. Morgan and ANZ were described as non-binding and conditional. The company therefore requested further details on how the acquisition would be funded and how the financing commitments would become binding and unconditional.
BlueScope concluded that if the consortium addresses the issues raised, particularly by increasing the offer value and clarifying the transaction structure and financing arrangements, the board would be willing to continue discussions and consider granting access to due diligence information.
