Brazilian anti-trust authority, Cade, has approved with no restrictions the acquisition of Ceará-state based steelmaker Siderurgica Latino-americana (Silat) by Gerdau, according to a document filing this week.
Gerdau announced in November 2019 it would buy a controlling stake at Silat for $110.8 million. The deal had been pending Cade’s approval.
Silat is based in the Brazilian state of Ceará and operates a 600,000 mt/year rebar and wire rod mill. It is owned by Spanish group Hierros Añón. Gerdau owns a steel mill about 12 miles from Silat, which has a 160,000 mt/year capacity.
Brazilian steelmaker Companhia Siderurgica do Espirito Santo SA, also known as Simec, opposed the deal, claiming Gerdau and Silat’s combined market share in the Northeast region of Brazil would be actually higher than estimated by both Gerdau and Silat.
As a result of the deal, Gerdau now owns a 96.35 percent stake at Silat, while existing investor Adece will keep its minority 3.65 percent stake.
Gerdau will use Silat’s existing rebar, wire rod (mesh and drawing grades), among other products, to extend its own product offering.