ArcelorMittal to buy 28.4% stake in France’s Vallourec for $1 bn

ArcelorMittal, the world’s second-largest steelmaker, on Tuesday said it will acquire a 28.4 per cent stake in French steelmaker Vallourec, for around 955 million euros ($1.04 billion), to expand its tubular products portfolio.

ArcelorMittal also announced the signing of a share purchase agreement with Apollo Global Management Inc, under which it will acquire 65,243,206 shares, representing 28.4 per cent equity stake in Vallourec, at €14.64 per share.

The Luxembourg-based holding company said it has no plan to launch a tender offer for Vallourec's remaining shares over the next six months, as per the regulatory process.

Aditya Mittal, CEO of ArcelorMittal said Vallourec’s premium tubular products have vital role in hydrogen, CCS and geothermal applications and are critical in the journey towards energy transition. 

Vallourec specialises in the production of seamless and welded steel tube products needed for sectors, including energy, automotive and construction.

Vallourec has an annual rolling capacity of 2.2 million tonnes and 85 per cent of its capacity is focused around low-carbon, integrated production hubs in US and Brazil.

Vallourec reported EBITDA of €1.2 billion on sales of €5.1 billion in 2023. Given the growth potential from hydrogen, geothermal and carbon capture, it expects earnings from the energy transition business to grow to 10-15 per cent by 2030.

ArcelorMittal, a leading integrated steel and mining company and Europe’s largest steelmaker, has presence in 60 countries and primary steelmaking operations in 15 countries.