Major long speciality steel producer, Brazil's Gerdau Group, has announced the conclusion of its acquisiton of US engineered steel bar producer MacSteel from Quanex Corporation. Gerdau and Quanex Corp. had reached their initial agreement on November 19, 2007.
The acquisition which is being financed by existing cash and short-term debt was completed for a consideration of $1.46 billion, plus assumption of debts and certain liabilities. However, Quanex's non-steel operation Building Products is not included in the deal.
MacSteel utilizes three scrap-based mini-mills (located in Jackson, Michigan; Monroe, Michigan; and Fort Smith, Arkansas) to produce up to 1.3 million tons of engineered special bar quality (SBQ) steel bars. MacSteel also has six downstream operations located in the states of Michigan (Atmosphere Annealing facility), Ohio, Indiana (two) and Wisconsin (NitroSteel facility). The company produces a total of 1.2 million mt of crude steel and employs 1,600 personnel
The mills operate using a low-cost continuous casting process with refined blending and finishing practices including electric arc furnaces for melting, ladle metallurgy injection for refined chemical composition and vacuum arc degassing for metallurgical cleanliness.
Through this acquisition, Gerdau is thought likely to enhance its position as the major world producer of long speciality steel for the automotive industry, and being a major producer of SBQ steel bars is sure to buttress Gerdau's position as a global supplier.