NLMK-Duferco JV and Esmark bid for Winner Steel

The Russian steelmaker Novolipetsk Steel (NLMK) and Swiss-based Duferco have announced that Duferco U.S. Investment Corporation (US-based subsidiary of the NLMK and Duferco joint venture company –Steel Invest and Finance S.A.) and Chicago-based steel service company Esmark have formed a consortium to purchase Pennsylvania-based galvanized steel producer Winner Steel. The consortium has signed a letter of intent with Winner Steel. The transaction, which is subject to further negotiation, the execution of a definitive assets purchase agreement and other conditions, is currently expected to be completed in the second quarter of 2007. Winner Steel, being the largest independent galvanized producer in the US, operates three galvanizing lines with a combined capacity of around 1.2 million metric tons a year. In 2006 the mill produced 600,000 metric tons of galvanized steel. Director of the Duferco Group and a board member of Steel Invest and Finance S.A., Mr. Benedict Sciortio, stated, “Being located just next to our Farrell facility in Sharon, Winner Steel is a logical component of our North American growth strategy. The acquisition is likely to create substantial synergies by ensuring a stable supply of cold-rolled material to Winner Steel and by increasing the downstream exposure of the NLMK-Duferco JV. We are delighted to work together with Esmark on this transaction and are hopeful that it may lead to successful joint projects in the future.”