ArcelorMittal buys Bayou Steel of the US; hikes stake in Turkey's Erdemir

16 June 2008

Mumbai: ArcelorMittal, the world's largest steel producer, has agreed to buy US-based structural steel maker Bayou Steel, for $475 million. ArcelorMittal also bought an additional 11.31 per cent in Turkish steel company Erdemir on June 13,  raising its stake in it to 24.98 per cent.

The shares were acquired at $6.69 a share, for a total consideration of around $869 million, in transactions with Societe Generale, Nextgen Capital Limited and Credit Suissee International, ArcelorMittal said in a statement.

Bayou Steel is an independent producer of medium and light structural steel and bar size products. The Louisiana facility produces billets, equal leg angles, unequal leg angles, flats, channels, standard beams and wide flange beams. The Tennessee rolling mill produces merchant bar shapes, including angles, channels, flats, rounds, and squares, as well as rebar.

Through its Mississippi River Recycling division, Bayou Steel operates an automobile shredder at the LaPlace facility, as well as barge wrecking and full-service scrap yards at LaPlace and its facility in Harvey, Louisiana.

The company also has a deep-water dock and distribution network, including four stocking locations in the US. Total prime finished product shipments for fiscal year 2007 were about 510,000 tonnes which generated revenues of approximately $331 million. The company employs 630 people.

''We are excited by the opportunity that this acquisition represents as it further strengthens our long product portfolio, customer base and distribution network in North America,"  said Jos Jacque, CEO of ArcelorMittal.