ArcelorMittal to sell LaPlace, Vinton steel plants in US to Black Diamond
26 March 2016
ArcelorMittal has entered into a definitive transaction agreement to sell its LaPlace and Vinton Long Carbon facilities in the United States to an affiliate of Black Diamond Capital Management.
Luxembourg-based ArcelorMittal said the terms of the transaction are confidential and are not being disclosed.
The deal will help the world's largest steel manufacturer reduce its debt that stood at $15.7 billion for the quarter ended December 2015.
The LaPlace, Louisiana, facility, along with a rolling mill in Harriman, Tennessee, produces billets, angles, flats, channels and beams. The Vinton facility, located in El Paso, Texas, produces rebar and grinding media.
Simultaneously, ArcelorMittal has entered into a transition services agreement with Black Diamond, in order to facilitate a smooth transition period and ensure no business disruption.
''The sale of LaPlace and Vinton is consistent with ArcelorMittal's stated strategy of selective divestment of non-core assets. I would like to thank the employees of LaPlace and Vinton for their commitment and efforts over the years, and wish them a successful future under new ownership,'' Jim Baske, executive vice president and CEO of ArcelorMittal North America, said.
The transaction is subject to customary closing conditions and is expected to be completed in April 2016, the company stated in a release.
Black Diamond manages over $8 billion in assets, across its three lines of business: control distressed/private equity, hedge fund and CLOs and other structured vehicles.
The steel giant, which continued to suffer from cheap Chinese steel imports, reported a decline in net sales at $63.58 billion in 2015 against $72.28 billion in 2014.
Hit by $4.8 billion write-downs on the iron ore mining business and a $1.3-billion charge on inventory owing to the global steel price plunge, ArcelorMittal reported a net loss of $7.9 billion in 2015 against a loss of $1.1 billion a year earlier.