Brazilian steel and iron ore producer Companhia Siderúrgica Nacional (CSN) said in a statement that it has entered into a binding term sheet with Bipadosa S.L., the holding company of the Megasa group.
According to CSN, the term sheet sets out the key terms and conditions for the sale of all shares issued by Stahlwerk Thüringen GmbH (SWT).
The term sheet provides for an exclusivity period of up to 10 weeks and an enterprise value of €550 million, subject to adjustments.
Megasa is a Spanish industrial group active in the European steel industry, focused on long steel products, with operations in Spain, Portugal and France.
SWT is a long steel producer based in Unterwellenborn, Germany, specializing in structural sections, with an installed production capacity of 1.1 million metric tons (mt) of steel per year.
CSN acquired SWT in 2012, when it planned to diversify its product portfolio and geographic footprint. It has now put the unit up for sale as one of several options to reduce its financial leverage, with net financial debt currently equivalent to 3.49 times annual EBITDA.
CSN is also selling its cement and logistics businesses and is considering bringing in a strategic partner at its Presidente Vargas steel plant in Volta Redonda, Rio de Janeiro state.
