Steel Mills
ThyssenKrupp Calvert, Alabama Steel Mill Sold
Written by John Packard
December 1, 2013
ArcelorMittal (AM) and their 50/50 joint venture partner Nippon Steel & Sumitomo Metal Corporation (NSSMC) reached an agreement with ThyssenKrupp AG to acquire the ThyssenKrupp Steel USA steel mill located in Calvert, Alabama. The purchase was valued at $1.55 billion for the 4.3 million tons of flat rolling capacity along with 1 million tons of stainless tolling capacity.
The Calvert mill consist of a hot strip rolling mill, pickling facilities, cold rolling facilities including a continuous anneal cold rolled mill and three coating lines capable of producing galvanized, galvannealed, aluminized and Galvalume products.
Included in the transaction is a six year slab purchase agreement for two million metric tons (2.2 million net tons) from the ThyssenKrupp CSA mill in Brazil. The first three years of the agreement calls for a “market-based price formula” with TK having a three year option to extend the slab agreement at more favorable terms to the joint venture compared to the initial time period. According to ArcelorMittal the formula will be based on Midwest hot rolled pricing.
ArcelorMittal advised that the rest of the slabs needed would be sourced from AM plants in the U.S., Brazil and Mexico. The price AM will receive for its slabs will be determined by the volume, price and cost performance of the joint venture.
ArcelorMittal is also responsible for marketing the products coming off the Calvert mill.
This is the first ArcelorMittal mill in the south and will significantly strengthen AM position as a core automotive supplier. The acquisition will also expand AM position in the NAFTA energy markets (pipe & tube).
ArcelorMittal and Nippon Steel already have a relationship in their I/N Tek and I/N Kote joint ventures located in New Carlisle, Indiana.
The transaction is subject to regulatory approval by the U.S. Department of Justice and the Federal Trade Commission.
Based on today’s conference call held by ArcelorMittal the deal is expected to close during the 2nd Quarter 2014.
John Packard
Read more from John PackardLatest in Steel Mills
Trump says US government to control 51% share in USS
President Trump says the US government will hold a 51% stake in U.S. Steel after the Nippon deal.
ArcelorMittal plans wire-drawing closure in Hamilton, shifts production to Montreal
ArcelorMittal’s (AM) Hamilton location to be shuttered, wire production shifting to Montreal.
USS, Nippon Steel quiet as litigation deadline approaches
There has been little word from U.S. Steel, Nippon Steel, or the White House since President Trump endorsed the companies’ “partnership” on social media and celebrated it at the May 30 rally outside Pittsburgh.
AISI: April mill shipments fall, sheet down YTD
US steel mills saw a decline in shipments from March to April.
Hybar rolls first rebar, ramping up Arkansas mill commissioning
The startup steelmaker produced its first rebar at its greenfield steel mill in Osceola, Ark., marking a key milestone by completing construction in 22 months.