Australia-based SGH Ltd has confirmed that it has submitted a non-binding indicative offer (NBIO) worth A$13.2 billion, together with US steelmaker Steel Dynamics, Inc., for the acquisition of 100 percent of Australian steelmaker BlueScope Steel Ltd through a scheme of arrangement.
Under the proposed structure, SGH would acquire BlueScope Steel in full. Following completion, SGH would then sell on BlueScope’s North American operations to Steel Dynamics.
Post-acquisition asset split structure
The North American assets included in the transaction comprise North Star flat rolled steel mill, and BlueScope’s building and coated products businesses. SGH would retain ownership of BlueScope’s remaining operations, covering Australian steel products, Asia coated products and New Zealand and Pacific Islands businesses
SGH and Steel Dynamics stated that BlueScope’s business segments would operate more effectively under separate ownership structures. From SGH’s perspective, BlueScope’s Australian-focused operations align closely with its existing industrial services and energy portfolio. Steel Dynamics, meanwhile, views BlueScope’s North American assets as highly complementary to its established steelmaking, fabrication and metals recycling platform.
Regarding financing, both SGH and Steel Dynamics indicated that they plan to fund their respective portions of the transaction using existing cash reserves and available debt facilities.
