Brazilian anti-trust authority, Cade, has agreed to review the appeal of local steelmaker Companhia Siderurgica Nacional (CSN) over the acquisition of slab producer Companhia Siderurgica do Atlantico (CSA) by Ternium.
According to a document filing this week, Cade has scheduled a hearing for CSN’s appeal for September 6 this year.
The deal was approved by Cade on August 1, with no restrictions. Later in August, CSN has filed an appeal, trying to reverse the deal.
CSN’s lawyers Cascione, Pulino, Boulos and Santos argued CSA is the “only carbon slab producer” in Brazil that is not vertically integrated to the country’s steelmakers and capable of offering the semi-finished product domestically at “competitive prices.”
CSN said Ternium is one of its main competitors in the local at steel market, considering it owns local producer Usiminas. CSN said the deal would result in the vertical integration of CSA with Usiminas, affecting CSA’s independence, which is seen by CSN as an “essential” provider of slab in Brazil.
“If approved, the deal would increase significantly the already ample power of the integrated player, generating serious risks to competition due to the restriction of access by finished steel producers in the country to a raw material that is essential for their productive process,” CSN said in its appeal at the time.
Ternium responded on August 29 saying CSN was just trying to “delay” the deal. “Actually, it has already sensitively delayed the transaction,” Ternium argued.
Ternium said CSA isn’t the only slab producer, adding other alternative suppliers include Vale’s Companhia Siderurgica do Pecem (CSP), Gerdau, Usiminas, Aperam, which all have idled capacity.
Ternium said that despite being aimed at exporting slab, CSP could meet most of the country’s slab needs.