Arcelor Mittal to acquire Mexico''s Sicartsa for $1.43 billion

Mumbai: Arcelor Mittal has received approval from the US and Mexican authorities to acquire Sicartsa from Grupo Villacero for an enterprise value of $1.43 billion (about Rs6,006 crore).

Sicartsa, a fully integrated producer of long steel, with an annual production capacity of about 2.7-million tonnes and estimated iron ore reserves of 160-million tones, is the largest long steel producer in Mexico .

The acquisition includes Metaver, a mini-mill, Sibasa and Camsa, two rolling mills in Celaya, Guanajuato (Sibasa) and Tultitlán in Mexico as well as Border Steel, a mini-mill in Texas, US in addition to the fully integrated steel making facility at Lázaro Cárdenas, next to Arcelor Mittal''s Lázaro Cárdenas works, the world''s largest steel manufacturer said in a release.

"The acquisition of the Mexican integrated steel producer was finalised following all required approvals of the transaction, including sanctions by the US and Mexican Competition Authorities," the release said.

Arcelor Mittal, the biggest supplier of steel used in automakers and washing machines in the US, wants to increase its share of North America''s construction market and capture Mexican market share. The buy-out is supposed to give it a foothold in a market dominated by Nucor Corp, Gerdau SA and Commercial Metals Co.

Luxembourg based Arcelor Mittal has also entered into a 50-50 commercial joint venture with Grupo Villacero to utilise the latter''s network for distribution and trading of its own products in Mexico and in the Southwest of United States.