Steel Mills
BlueScope to Buy Coil Coatings for $500M, Expand in Eastern US
Written by Michael Cowden
April 11, 2022
BlueScope plans to buy Coil Coatings from Cornerstone Building Brands for $500 million to expand its presence in painted products in the eastern US.
The Australian steelmaker – parent company of sheet producer North Star BlueScope in Delta, Ohio – said the deal would complement its existing coated products business on the West Coast.
The sale is expected to close this calendar year pending customary regulatory approvals and other closing conditions, the company said on Monday, April 11.
“As a global leader in painted steel products for building and construction applications, this deal hits our sweet spot,” BlueScope managing director and CEO Mark Vassella said in a statement.
Coil Coatings, the second largest metal painter in the US, has annual capacity of 900,000 metric tons per year. Its seven facilities make products for commercial and industrial construction, BlueScope said. The acquisition will triple its coating and painting capacity in the US from 475,000 tons per year to 1.3 million tons per year.
BlueScope said last year that it was considering building a greenfield painting facility in the eastern US. Some sources said at the time that the announcement might have been aimed at trying to knock a potential seller down on price.
This is not the first deal over the last year involving Cornerstone Building Brands. The building products manufacturer last year sold its insulated metals panels business to Charlotte, N.C.-based Nucor for $1 billion.
For BlueScope, the deal is just the latest in a series of aggressive expansions in the US market.
The company in December closed its $240 million deal for ferrous scrap recycler MetalX.
The additional scrap will be used to feed the expansion of BlueScope’s electric-arc furnace (EAF) sheet mill in Delta. That project is slated to add 850,000 metric tons (roughly 937,000 short tons) of annual capacity. The company expects production of the first coil in mid-2022, followed by an 18-month ramp-up to the full run rate.
By Michael Cowden, Michael@SteelMarketUpdate.com
Michael Cowden
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